Protecting your assets from things such as lawsuits, Medicaid recovery, and creditors is an important part of estate planning. Generally, people want their assets going to loved ones or beneficiaries they choose. There are a number of ways to do this, and make sure your assets are protected. Whether a trust is right for you depends on what you want to protect and from whom.
As we age, we start looking at end of life care more seriously. We know that when we turn 65, Medicare will kick in, and it will cover our doctor visits and prescriptions and hospital visits. However, when it comes to long-term care, what is Medicare’s role, and how do we protect our assets?
There are several ways to protect your assets, and preserve them for your heirs. One way to do that is through a family trust. When someone decides to set up a family trust, it is meant to benefit their relatives. It is meant to specifically benefit the person’s family, which can include blood relatives, relations by marriage, or relations by law, in the case of adoption. These can be revocable or irrevocable trusts and are essentially a subcategory of living trusts.
A living trust is set up to benefit both you and your heirs throughout your and their lifetimes. It is designed to hold your assets safely within it and give you the power to organize it how you would like. A living trust helps to avoid probate and provide for a smooth transfer of assets after a person dies. Transferring assets into a trust can save years and thousands of dollars in legal fees. However, not all of your assets should be included in a living trust, for various reasons. We will go over those here.
The reality of aging is a part of life, and, as unpleasant as it may be, it may lead to needing long-term care before we pass away.
Whether it is caring for a specific cognitive illness, such as Alzheimer’s disease, or any number of physical ailments that leave a person unable to care for themselves, going into nursing home care requires us to examine a host of issues. This includes the costs of a nursing home and how to protect your assets.
When a person decides to set up a family trust, it is meant to benefit his or her relatives. A family trust is meant to specifically benefit the person’s family, which may include blood relatives, relations by marriage, or by relations by law, in the case of adoption. A family trust can be a revocable or an irrevocable trust which is a subcategory of living trusts.
It is probably safe to assume that a conversation about a prenup is not what most people want to think about. After all, none of us think we will be in a position to actually need to know what a prenup protects, and how it works, especially after we’ve just committed to the person we love for the rest of our lives. Unfortunately, things do not always work out, and life does not always go the way we planned.
It is an unfortunate fact of life. When you or a loved one reaches the stage of life, where you may need long-term care or a nursing home, Medicaid can help to cover the cost, as most of us will run out of the money needed to pay for these facilities. However, when the person dies, Medicaid will go after any assets they have in order to pay back what was paid out for the person, in a process called the Medicaid Estate Recovery plan.
As we grow older, the possibility that a
spouse may need long-term care in a nursing home grows. While it’s a tough part
of life to face, there are other questions that go along with it, as well.
Among the main concerns is protecting your assets, should a spouse end up in a
nursing home for long-term care.
As we age, it only makes sense that
our parents are aging, as well. And while watching our parents grow from the
people who took care of us into elderly adults who, in turn, need care can be
difficult, it’s important that we’re aware of what we can do to protect them
mentally, physically, and financially. Concerning the latter, there are ways to
protect elderly parents’ assets. And while it may seem complicated, there are
ways to make sure it happens.