The Importance of Estate Planning

Have you written a will or established a trust? Have you decided how you’d like to pass on your assets to family members, friends or charities? Have you also prepared for the possibility you could require long-term health care?

            Estate planning is important for a number of reasons, not the least of which is the orderly transfer of assets in the manner you deem best. But given the growing proportion of people who spend at least some time in nursing homes and the increasing cost involved, long-term care planning is equally important. Consider this: The average cost of skilled nursing care in Colorado tops $6,300 a month.

            Estate planning and long-term care planning go together like a hand and glove. Fortunately, it’s not only possible, but also advisable and usually less expensive, to do both at the same time. While sooner is always better than later, it’s never too late to start.

            It’s possible to both protect assets earned over a lifetime of hard work and qualify for Medicaid assistance to pay for long-term care. But the required transfers of assets could create a period of ineligibility for benefits that extends up to five years.

            Federal laws regulating Medicaid eligibility hold other implications for estate and long-term care planning, including the use of annuities, the sale of a business or farming operation to a family member and a cap on available home equity.

            A careful review of wills, trusts and other estate planning documents could be in order for married couples if there’s a possibility one spouse could require long-term care while the other spouse remains at home. A simple will that leaves assets to the surviving spouse could affect Medicaid eligibility if the spouse at home dies first. Alternatively, changes could be needed to ensure adequate income and other protections for the spouse at home.

            Even people who’ve already been admitted to nursing homes still have options, using some assets to pay for long-term care while protecting other assets, including the home.

            By all means, complete your estate planning as soon as possible. But at the same time, seek competent legal assistance with long-term care planning. One is as important as the other.

 

Editor’s Note: This article was submitted by Billie Castle, Esq. with The Law Office of Billie M. Castle, LLC and may be reached at 970-255-7488 or by email at billie@billiecastle.com. For more information visit The Law Office of Billie M. Castle, LLC on the web at: www.billiecastle.com