In today’s society and as we age, we must understand that the greatest threat to middle-class, senior-citizen taxpayers is the devastating cost of long-term care.
The way to begin preparing is to recognize that we go through three phases in life and those phases are the: 1) maturing years, 2) senior years, and 3) post- death years.
Don’t make the mistake of assuming because you had your local attorney prepare a will, trust and power of attorney that you have prepared for your long-term care. In most cases, these documents do little to help.
Take these steps:
1) Recognize that powers of attorney are the most underestimated of the estate planning documents. Also, not all powers of attorney are the same. Most that we see are weak and ineffective.
2) Watch the timing of your benefits. Do not apply for Social Security, VA benefits, Medicaid benefits or Medicare benefits until you have consulted with an Elder Law attorney, your CPA, and your financial and insurance advisers.
3) Realize that your revocable living trust does not protect assets from long-term care costs, in fact they make things worse.
4) Act before you lose the mental capacity to act. The saddest cases we see are where seniors are brought to us who need our help but are unable to engage us without invoking guardianship because they have lost the requisite mental capacity to retain an attorney and grant power of attorney to someone.
5) Never transfer assets to family members, caregivers or anyone else without the advice of an elder law attorney who focuses exclusively in Medicaid asset protection planning. These transfers can cause Medicaid eligibility problems, tax problems and creditor fraud problems.
6) Take advantage of special relief provisions the law provides you. Be aware of Social Security election options, initial enrollment periods from Medicare, Medicaid eligibility exceptions for transfers to spouses, adult disabled children and minor children. Also, be aware of VA benefits eligibility.
7) When you find the right kind of care solution, make sure you understand the contract. Regardless of whether it’s in home care, independent living, assisted living or nursing home care, we see people signing contracts without even reading them. Worse yet, sometimes a senior’s child will sign on behalf of the senior, thus making the child liable for their parents’ long-term care costs when they do not have to do so.
For more, call 847-292-1220, e-mail email@example.com or visit www.ABFerraroLaw.com.