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How estate planning can help you cover future medical costs

On Behalf of | Mar 10, 2020 | Uncategorized

Estate planning isn’t just about deciding to whom you want to leave your possessions when you die. It is also about planning for your retirement, for your care in your later years and for the legacy you leave behind. Few things will diminish your ability to leave a meaningful legacy as quickly as serious medical issues in your final years.

Nursing home residency or skilled in-home nursing care can cost thousands of dollars a week. In some cases, government insurance programs can make claims against your estate for benefits paid out during your life.

Other times, the government might deny you benefits like Medicaid until you pay a certain amount out-of-pocket because of your financial resources. Creating a trust as part of your estate plan can protect you and the legacy you want to create. 

A trust diminishes the value of your assets to help you qualify for Medicaid

One of the most important parts of creating the trust is the process of funding the trust. People do this by transferring ownership of assets from their name to the name of the newly-formed trust. It’s common for people to fund their trust with investment accounts or even life insurance benefits. However, you might want to also consider placing the title for your home in a trust.

The more assets you move into a trust and the earlier you do so, the easier it will be for you to qualify for Medicaid benefits when you need them. The government can review five years of your financial records when you apply for Medicaid and hold you accountable for any gifts or transfers made during that time.

By planning earlier in life to qualify for Medicaid, you give yourself peace of mind because you know you can get care if you need it while also protecting the inheritance you worked so hard to build up for your family members and loved ones.