Sick or Disabled Parents?

6 Steps To Protecting Your Assets From Nursing Home Care Costs

6StepsProtectAssetsNursingHomeCosts-Doug Newborn
Edited by Doug Newborn

If you’re concerned about how to pay for long-term care or support a family member, this is essential reading. Understand your options and plan accordingly by learning government policies on nursing home costs.

STEP 1: Treat your loved ones with the gift of financial security before it’s too late. No one can predict the future and safeguarding your assets is an important part of any long-term retirement plan. Look ahead to a time when you might need nursing home care, and gift money now to loved ones in good standing with the law – thereby ensuring that your hard earned funds remain secure for them even after passing on.

STEP 2: Naming yourself as the life tenant and a trusted loved one as remainderman, creating a “life estate” is an essential strategy for preserving future ownership interest in your real estate. With this arrangement you retain full rights to inhabit the property until death- preventing state claims from jeopardizing its value – while also increasing protection against certain financial penalties if instances of nursing home care arise within five years after transferring it.

STEP 3: Utilize the potential of annuities. There are many states that can help you maintain current Medicaid eligibility. When transferring assets into an annuity, it could be a beneficial decision in terms of qualifying for nursing home care while protecting your Liquid Assets from spending down. However not all locations sadly offer this service so make sure to review if periodic payouts may affect economic aid first before making any decisions.

STEP 4: To ensure your spouse’s financial security, consider transferring a portion of your monthly income to them each month. The Federal Spousal Impoverishment Act provides legal protection for couples in this situation and can help balance out any gaps between the exempted amount set by the state and what is needed for nursing home care if one partner requires it. This generous act helps secure spouses’ future economic well-being while they are using necessary resources like long term health services.

STEP 5: If you are looking for the ultimate in financial protection, an irrevocable trust may be your answer. Not only is principal from this type of trust exempt from nursing home costs, but its periodic interest and dividends can also remain safe beyond reach.

STEP 6: Ensure the financial stability of both you and your spouse with a “pour-over” Trust. This trust shields assets from seizure while still offering easy access to funds, preventing any money worries for either party in the future. To maximize protection, modify or create wills that include testamentary trusts which provide welfare for surviving spouses – keeping their shared wealth safeguarded even if one passes away first.

Other important things to consider…

To provide for your family’s future, you can choose to allocate more funds in spousal maintenance—simply increase the monthly amount by one-third per dependent adult or minor child living with you. By doing so, it will ensure that every member of your household is taken care of regardless what state law may dictate.

With the passage of the Omnibus Budget Reconciliation Act, state Medicaid officials have the power to recoup any covered funds from your estate after you pass away. This means that unshielded assets could be lost for future generations unless proper steps are taken beforehand in preparation for nursing home care.

It is important to remain aware of the annual gift tax limit if you are considering making a monetary donation to your family.

About the author

Doug Newborn

Doug understands how to manage multiple areas of the law while bringing efficiency and a unique personal touch. In other words, you won’t be our only client, but our goal is to make you feel like you’re our only client.

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