General wisdom always advises to plan ahead to avoid unpleasant situations and make the most of opportunities. This advice is certainly valid for the most important decisions we make in our life – those involving caring for ourselves and our families and providing for financial welfare. Planning ahead will give you peace of mind that your goals will be met and your loved ones taken care of as you prefer.
Estate Planning Basics: Wills & Trusts
It is never too soon to start thinking about who should inherit your assets when you die. Your basic strategy should include making a will that sets out your plans for providing for your loved ones. You want to remember your spouse, children, even grandchildren, and you may also wish to include charitable organizations you have supported. If you die without a will, the probate courts will decide the distribution of your assets, and their decisions may be not at all what you would have preferred.
Another option to consider for you and your family is establishing a living trust to manage your assets during your lifetime and create a clear line of succession upon your death. A living trust (sometimes called an “inter vivos” or “revocable” trust) is a written legal document which directs your assets into a trust for your benefit during your lifetime and then transfers the assets to designated beneficiaries at your death under management of your chosen representative, called a “successor trustee.” A trust provides the advantage of avoiding a long and sometimes costly probate process and allows your heirs access to their assets in a more timely manner.
Find out more about Trusts and Wills here.
If you are the parent of a child with special needs, you definitely want to consider establishing a special needs trust for his or her benefit. Whether funded during your lifetime or after death through the settlement of your will or trust, a special needs trust provides quality-of-life extras for your special needs child without jeopardizing his or her qualification for basic government benefits such as Supplemental Security Income or Medicaid. Find out more about a Special Needs Trust here.
As your estate planning attorney, Glenn A. Deig will help you navigate the process of making a will and setting up an appropriate trust plan now while you can benefit from the peace of mind planning ahead provides.
Planning for Health Care
One area where planning ahead can bestow peace of mind, especially in emergency situations, is providing information about your wishes for your health care and appointing someone who would make decisions for you if you should be unable to do so.
A living will is a legal document in which you state your preference for medical treatment to be administered if you are seriously ill or injured and unable to make decisions. When properly executed and witnessed and provided to your physician or hospital, a living will gives medical professionals guidelines in decision making for you.
A healthcare power of attorney is a legal document that allows you to appoint a person you trust to make decisions regarding your medical treatment if you are unable to do so. Your healthcare power of attorney becomes active if you are disabled or incapacitated and cannot consciously communicate your decisions regarding care. It is important that your power of attorney be someone with whom you have discussed your general desires regarding healthcare and who understands your wishes. It is also important that he or she is a person who will stand up for your preferences in spite of others who might express opposition.
You can learn more about Living Wills and Powers of Attorney here.
Although you may be perfectly healthy and not even thinking about the possibility of debilitating illness, accident or injury, you should consider the possibility that you might in the future require long-term care in a nursing home. According to the U.S. Department of Health and Human Services, “Someone turning age 65 today has almost a 70 percent chance of needing some type of long-term care services and supports in their remaining years.” Nearly 40 percent of aging individuals will need nursing facility care. The fact is that such care is extremely expensive, as much as $70,000 a year or more, and the need for nursing home care could deplete your family’s assets very quickly. Many people depend on Medicaid to pay for their long-term nursing home care. However, Medicaid funding is based on the resident’s lack of sufficient assets to pay for his or her care, so it may be necessary to reduce the value of your assets before you qualify.
By planning ahead with judicious use of trusts and other financial instruments, you may be able to preserve a significant portion of your assets for use by yourself and your family. Learn more about Medicaid Planning here.
It’s never too early to start planning, but you should consult an experienced elder law attorney in order to avoid mistakes in Medicaid asset protection planning. The experienced professionals with Glenn A. Deig, Attorney at Law, will help you evaluate your Medicaid planning and advise you on the strategies that are right for you.