Jul
19
2013
0

Baby Boomers Predict The Future!

Baby Boomers Predict The Future!

Wouldn’t it be nice to be able to predict the future for us Baby Boomers, and start planning for it! But we do know certain things about our future …

  •  On average, 10,000 people are turning age 65 every day.
  • It is predicted that at least 70% of people over age 65 will need long-term care services.
  • Currently, the median cost of long-term care for one year in the United States is $83,950.00.
  • In 30 years, when the last of the Boomers reach age 65, the price of long-term care is expected to be at an all time high of $190,000 per year.
  • Currently, the average amount of time a person needs long term care is 2.7 years.

 As my grandson would say, “OMG!”

As a senior estate planning attorney, and a Baby Boomer, we need to ask ourselves what we can do to plan for our long term care. GE Long Term Care Insurance conducted a study and found that nursing home costs are rising at a rate of 5% every year, outpacing inflation. With the rapidly growing elderly population this is the simple law of supply and demand.

 So, what can we do to prepare for the second half of life? If you or your spouse are age 65 and one of you goes into a nursing home, do you have a spare $513,000 lying around to pay for your or your spouse’s care.

 We still have Medi-Cal in California, which pays for the cost of a skilled nursing facility. The VA Aid & Attendance Pension benefit is still available to help pay for in home care and assisted living facility costs.

But you need to “get your ducks in a row” ahead of time to plan for qualification for these benefits. For starters, Baby Boomers are now taking advantage of modern asset protection and government benefits planning qualification techniques, which are incorporated into their estate planning documents. Also, one of our main goals is to preserve our homes for our children, without a lien for payback to Medi-Cal. With the modern language in your estate planning documents, if you become incapacitated, your spouse or loved one can follow through with qualification and asset protection techniques under the Medi-Cal and VA regulations.  

This information is not to be taken as legal advice, and you are encouraged to see your senior estate planning attorney before attempting any of these techniques. 

At the Law Offices of Michael J. Young, at 1931 San Miguel Dr., Ste. 220, Walnut Creek, CA www.WalnutCreekElderLaw, 925-256-0298, lawyoung1@gmail.com we practice Elder Law and we help Baby Boomers and families through the Elder Care Journey. We help families with long-term care planning, asset-protection plans, comprehensive estate planning, wills, trusts and powers of attorney. We also help Baby Boomers and families get their “Ducks in a Row” in order help them qualify for Medi-Cal and the VA Aid & Attendance Improved Pension benefit.

Apr
19
2012
0

The Importance of an “Elder Law” Durable Power of Attorney

     Does your Financial Durable Power of Attorney (financial DPA) contain asset protection and government benefits qualification language? It probably does not, unless it was prepared by an elder law attorney. If you lose mental capacity, your spouse or children may be prevented from gifting your assets to themselves, in order to help you qualify for Medi-Cal or for the VA Aid & Attendance Pension benefit.

If your financial DPA contains any gifting language at all, it is probably limited to the annual gift tax exclusion amount, which is $13,000 per person this year. This language is usually of little help for Medi-Cal qualification. In addition, the language will probably not allow for gifting to the ”attorney in fact”, who is the person acting for you.  Specialized language is required under the law in order to allow for any gifting to the person acting as the “attorney in fact.” This specialized language usually does not appear in a “regular” financial durable power of attorney.

For instance, the home can easily be established as an exempt asset for Medi-Cal qualification. If the home is in the name of the Medi-Cal applicant who has lost mental capacity, and we want to transfer the home to a child and reserve a life estate to the applicant in order to avoid a Medi-Cal lien, most financial durable powers of attorney will not allow for this. Most financial durable powers of attorney will allow a transfer only upon receipt of consideration from a sale for fair market value of the real property.

To give another example, the Medi-Cal applicant, under the regulations, is allowed to own a life insurance policy, with a pay on death figure in any amount. However, in order to qualify for Medi-Cal, the applicant’s life insurance policy cannot have more than $1500 cash value. If there is a $5,000 cash value, for instance, the Medi-Cal applicant cannot qualify. The remedy is to liquidate the cash from the policy and then gift it out. What do you do however if the Medi-Cal applicant has lost capacity? We need to then look at the powers in the financial durable power of attorney. However, although most financial DPAs may allow for a liquidation of the cash value, they will not allow you to gift the cash out. The Medi-Cal applicant can only retain $2,000 in non qualified accounts, and if the cash from the policy cannot be gifted, it would have to be spent before qualification for Medi-Cal can be obtained.

The financial DPA in an elder law context, is also coordinated with the revocable living trust of the applicant. There should be specialized asset protection language in the trust, which refers to the financial DPA. This specialized language will allow the attorney in fact to “stand in the shoes” of the maker of the trust, for all purposes, including for Medi-Cal qualification. This technique is allowed by law, and provides the greatest amount of flexibility for the family who is helping the older person who has lost capacity, when we are applying for Medi-Cal.

Remember that if existing estate planning documents are not updated before the older person loses capacity, we may have to resort to a court proceeding to modify the language in the documents. This process is expensive and is not always guaranteed. The best approach is to pre-planning, and to have your estate planning documents updated as early as possible by a qualified elder law attorney, who practices full time in this area of the law. 

Written Michael J. Young, elder law attorney in Walnut Creek, CA. www.WalnutCreekElderLaw.com mike@WalnutCreekElderLaw.com. 1931 San Miguel Dr., Suite 220, Walnut Creek, CA 94596. 925-256-0298. Mr. Young serves Contra Costa and Alameda Counties, including the cities of Walnut Creek, Alamo, Danville, Concord, Brentwood, Pleasant Hill, Antioch, Clayton, etc. Mr. Young advises clients regarding Medi-Cal, nursing homes, asset protection, the VA Aid and attendance pension benefit, and long term care planning. Mr. Young is a Concord Elder Law Attorney with offices in Walnut Creek, CA.

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Oct
17
2011
0

What Is The Difference Between Elder Law and Estate Planning?

I practice Elder Law and represent the older client and their families. When clients come to see me, their concerns are not so much about what happens when they die, but more about ’What happens if they don’t die.’

Of course, they want to make sure that their assets pass to their family with a minimum of expenses and taxes. But the bigger and more complicated question is, “What happens if I don’t die?” As we know, Americans are living longer all the time. The infirmities of old age may require that we have in home care assistance, or go to an assisted living facility, board and care home or eventually a to a nursing home.  We are of course concerned about how we pay for these costs. A regular estate plan does not address these needs. An elder law attorney can prepare a long term care plan for you, and address these needs. He will also address the concern of passing assets to their family.

To put it another way, a regular estate plan insures that if you die, your assets will be passed on to your family the way you want. The operative word is “if”. A  regular estate plan will not help preserve assets so that hopefully there will be something left when you die to pass on to your family. As we know, the assets of the older client could be depleted by a nursing home stay or lengthy illness, which could leave their spouse or heirs with nothing.  

If you have sufficient assets to pay for long-term care or nursing home costs without running out of funds, then a regualr estate planning attorney may be all you need. However, if you cannot afford the cost of a lenghty nursing home stay, of around $90,000 per year or $180,000 per year for a couple, or more, then an elder law attorney would be able to help you.

For a real life example, Mary and Jim have about $300,000 in assets and a home worth around $500,000. Jim needs assistance and uses a wheelchair. Mary has been providing for his care, but recently has shown signs of forgetfulness and confusion. She has been diagnosed by her doctor as having early signs of dementia.   

An estate plan is of course important to Jim and Mary, but this won’t help them deal with the problems they are presently dealing with. They want to tackle the issue of how they will be able to afford the cost of nursing home care should either one or both of them need it. They want to establish how they will be taken care of should Mary’s dementia become more advanced. They want to find out if if they can stay in their home with assistance.

This couple needs a life plan, specific to them, to meet their needs for the future. Jim and Mary need to seek the advice of an elder law attorney.

Written Michael J. Young, elder law attorney in Walnut Creek, CA. www.WalnutCreekElderLaw.com mike@WalnutCreekElderLaw.com. 1931 San Miguel Dr., Suite 220, Walnut Creek, CA 94596. 925-256-0298. Mr. Young serves Contra Costa and Alameda Counties, including the cities of Walnut Creek, Alamo, Danville, Concord, Brentwood, Pleasant Hill, Antioch, Clayton, etc. Mr. Young advises clients regarding Medi-Cal, nursing homes, asset protection, the VA Aid and attendance pension benefit, and long term care planning. Mr. Young is a Concord Elder Law Attorney with offices in Walnut Creek, CA.

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Sep
28
2011
0

Elder Law is Alzheimer’s Planning

According to the Alzheimer’s Association, Alzheimer’s disease affects more than 5 million people in the U.S., and is the seventh leading cause of death in the U.S. today. This disease is expensive for the families of Alzheimer’s patients. And, it is the families who absorb much of the cost of care.

There are government resources available to help pay for the cost of care. The VA Aid & Attendance Improved Pension Benefit for wartime veterans and the surviving spouses of wartime veterans can be very helpful to pay for care. For the single veteran, the pension rate can be as much as $1,644 per month or $19,736 per year. For the surviving spouse, the pension rate can be as much as $1,056 per month, or $12,681 per year. This VA benefit can help pay for the costs of in home care, assisted living facilities and board and care homes.

Another government benefit is Medi-Cal, which can pay for skilled nursing facilities for the Alzheimer’s patient.

Qualification for both of these programs, the VA Aid & Attendance Pension Benefit and Medi-Cal, are asset and income based. Planning for these benefits can be done through your elder law attorney. You should pursue your long term care planning goals, including asset protection, through your elder law attorney as early in the process as possible.

Your elder law and asset protection attorney will update the estate planning documents of the Alzheimer’s patient, provided it is not too late, to include asset government benefits planning, and asset protection language. Thereafter, planning steps are made over time for asset protection and for qualification for these programs.

Michael J. Young, who is an elder law attorney in Walnut Creek, CA, helps many clients with Alzheimer’s disease, and their families, with Alzheimer’s Planning. Elder Law is Alzheimer’s Planning.

Mr. Young is an elder law attorney who represents clients in Concord, Walnut Creek, Pleasant Hill, Brentwood, Antioch, Clayton, Danville, Alamo and surrounding areas.

This blog is for informational purposes only and is not legal advice. You should consult an elder law, asset protection and government benefits planning attorney for your particular case, and before you proceed with any planning.

Written Michael J. Young, elder law attorney in Walnut Creek, CA. www.WalnutCreekElderLaw.com mike@WalnutCreekElderLaw.com. 1931 San Miguel Dr., Suite 220, Walnut Creek, CA 94596. 925-256-0298. Mr. Young serves Contra Costa and Alameda Counties, including the cities of Walnut Creek, Alamo, Danville, Concord, Brentwood, Pleasant Hill, Antioch, Clayton, etc. Mr. Young advises clients regarding Medi-Cal, nursing homes, asset protection, the VA Aid and attendance pension benefit, and long term care planning. Mr. Young is a Concord Elder Law Attorney with offices in Walnut Creek, CA.

Through proper planning from an elder law attorney,  disease is not too far advanced, the

Michael J. Young is an elder law attorney in Walnut Creek, CA.

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