Time & Life Update Newsletter

February 2015 Newsletter

Posted by Dennis Sullivan & Associates on Feb 27, 2015 11:24:00 AM

Medicaid is About More than Just the Finances

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Something we always seem to need to remind clients of when we talk about Medicaid eligibility is that Medicaid isn’t just about the finances.  Meeting the income and asset limits are not the only requirements when applying, applicants also need to be medically eligible for Medicaid assistance.

What does that mean?  It means an applicant must establish the need for nursing home level care, needing assistance with the activities of daily living.  It’s one of the reasons why the planning that we do is so vital.  If you run out of money before your health is bad enough to require long-term care, you won’t be able to get MassHealth to help you.  Unfortunately it is an all too common scenario, one which we were reminded of last week.

We received a call from Jane regarding her dad, Donnie, who has been living with Jane for the last several years.  Donnie is bipolar but he functions well when he takes his medications.   It often is a struggle, however, to get him to take that medication.  Jane works during the day so she can’t always at home to monitor her dad.

Jane explained that her dad becomes somewhat agitated and occasionally wanders when he hasn’t taken his medication.  When I asked about his ability to walk, eat, bath, dress and toilet on his own, Jane replied that this isn’t Donnie’s problem.

Jane called because she wants to move her father to an assisted living facility, feeling that he now needs more supervision than she can provide on her own.  Donnie has only a few thousand dollars to his name, and he is planning to apply for Medicaid to pay for his care.

There are several problems with Jane’s plan.  She hasn’t even begun to look at facilities but when she does, she will likely find the choices very limited since it is not easy to get into a facility on Medicaid right away.  Most assisted living facilities try to use their Medicaid “slots” for their longtime residents who have spent down assets while at their facility.  Although there are a few that will take a person on Medicaid right away, none happen to be in Jane’s immediate area.

I told Jane the best solution for now is to hire someone to come to her home for a few hours a day when she is at work to keep an eye on Donnie.  The cost won’t be covered by Medicaid, but that’s one of the reasons that getting government benefits is so tricky.  The rules are complicated and the government – not you – decides whether it will provide you with assistance.  And in Jane and Donnie’s case, the answer is “not yet”.  The’ll have to go it alone for now.

Click Here to Download the Senior & Boomers Guide to Health Care Reform & Avoiding  Nursing Home Poverty

 


Don’t Forget About Rover

Who Will Care For Your Pets When You’re Gone?

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If you have a dog, cat or other pet, you know that the unconditional love and affection our pets devote to us improve the quality of our lives in ways nothing else can. This is why they deserve our respect and dedication even after we pass away or become incapacitated.

Unfortunately, if a pet owner becomes unable to care for his or her pets, they often end up living on the street. Thousands of pets are orphaned every year in the United States. To prevent your pets from adding to this sad statistic, you need to plan now for their care in the future.

One way to do this is to include your pets in your estate plan. This can be as simple as incorporating provisions for them into your Will or Living Trust. A Durable General Power of Attorney will allow an agent of your choosing to spend funds that have been allocated to your pets as he or she sees fit in the best interest of your pets.

The income is made available as ongoing Trust funds or as a gift given directly to the agent.
The first, and often easiest, way to make sure your pets are cared for is to include a request that your pets be placed with a willing friend or family member. This is done in the same way you would appoint a guardian for a child. In addition, most states allow for money from your estate plan to be set aside for the benefit of pets so that there is minimal, if any, expense for your pets’ caretaker.

Another option is to appoint a Trustee to care for your pets. This Trustee can either keep the pets in his or her own home or find someone else with a suitable, loving home to serve as caretaker. This type of “Pet Trust” also provides the Trustee with funds to be used for the pets’ benefit.

If a suitable Trustee is not available, you may want to research local animal shelters and adoption centers. If sufficient funds are allocated for the care of the pet, some locations will accept pets that are donated through Trusts and care for them until a devoted home can be found for them.

Considering Pet Insurance?
You may have noticed that in recent years veterinary science has advanced by leaps and bounds. Veterinarians today offer treatments that were unheard of only a few years ago. Treatments, such as organ transplants, once only used on humans are now available for pets. Veterinarians also have access to more advanced technology that can detect problems that, in the past, would have gone untreated. For pet owners, this means higher costs per visit and possibly expensive procedures.

Pet insurance can help you cover these new costs. It is best used to protect against unseen catastrophic expenses, not procedures you can easily pay for on your own. Pet insurance allows you to worry about your pet’s health and not how you are going to pay for it.

Some good advice when looking for pet insurance is to shop around and find the policy that best fits your needs. Remember to not only pay attention to the monthly or annual cost, but to note the differences in deductibles, co-pays and caps, which may limit payouts by incident, annually or the animal’s lifetime. Make sure that you understand the exclusions. The conditions most likely to afflict your pet are often the ones most likely to be excluded from your policy.

A few things to consider:

  • It is possible to spend more money on your pet if you have insurance than if you did not have insurance.
  • One alternative to pet insurance is to put the money you would spend on premiums into a savings account.
  • Dogs tend to wind up in the veterinarian’s office twice as often as cats.
  • Purebreds tend to have more hereditary weaknesses than the average pound puppy or cat.
  • Free-running animals have more accidents and contract more illnesses than pets that are kept under control.


Regardless of whether you decide to get pet insurance or not, it is always a good idea to think about the future. Put yourself at ease and know that you will be able to take care of your pet no matter what happens.

 

Click Here to Register For Our Trust, Estate & Asset  Protection Workshop

Tags: long term care, Medicaid, MassHealth, Nursing Homes, family, trusts, caregiver, insurance, medicaid qualification, 2015, trustee

September 2013 - Newsletter

Posted by Massachusetts Estate Planning & Elder Law Attorney, Dennis B. Sullivan, Esq., CPA, LLM on Nov 6, 2013 10:35:00 AM

Click here for the September 2013 Newsletter!

 

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Tags: Baby Boomers, Elder Law, HIPAA, 2013, Announcements, Wellesley, assisted living, Attorney, Massachusettes

September 2013 - Living Trust Flyer

Posted by Massachusetts Estate Planning & Elder Law Attorney, Dennis B. Sullivan, Esq., CPA, LLM on Nov 6, 2013 10:24:00 AM

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Click here for the Septemer 2013 Why Many Living Trusts Fail Flyer!

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Tags: 2013, Announcements, trusts, Wellesley, Nursing Home

NEWTON COUPLE DISCOVERS SECRET TO PROTECT THEIR HOME & LIFE SAVINGS WHILE AVOIDING PAYMENT OF UNNECESSARY TAXES

Posted by Massachusetts Estate Planning & Elder Law Attorney, Dennis B. Sullivan, Esq., CPA, LLM on Sep 11, 2012 4:48:00 PM

A financial advisor initially referred the Lowell family to us.  They were concerned about estate planning, taxes, and did not want to loose their life savings to a nursing home.  When they came to our office, they had been told at a cocktail party, barbershop, or beauty parlor, they couldn’t remember which, that they should deed their home to their two children if they wanted to protect it.  When I asked if it made sense for their children to be saddled with $150,000 capital gains tax, they replied, “No, of course not”.  They thought it made a lot more sense to protect their home in a manner that would permit them to sell their home, which they eventually did, completely free of any capital gains tax, up to $500,000.  The Lowells were even happier when they learned they could start the five-year look back period required to protect assets from being spent down on a nursing home if either got sick. 

Unique Educational & Counseling Process

Massachusetts Veterans Benefits, Aid & Attendance, Estate TaxAs part of our unique process, we asked the Lowells about their top planning goals.  They talked to one and other and reported back to us that they wanted, above all else, to protect their life savings and home for each other in the event either got sick or went to a nursing home, so they could protect things for each other and leave a greater legacy for their two children.  With their objective clear, we then helped create and put in place the planning necessary to help the Lowells accomplish their objectives.  The sense of relief as a result of finally taking care of their estate and asset protection planning was visible on Lowells’ faces.  

Planning Early Saves Thousands Later

A number of years later, our office was contacted by an attorney trying to help sell the Lowells’ home.  The attorney happened to be married to the real estate broker who was in the process of helping sell the home.  Upon speaking with the attorney for the bank, we were told said the bank preferred working with the trustee of the trust, and after the home had been deeded to it.  We were able to get the deed recorded and fortunately for the Lowells, that property was deeded to their trust, so the proceeds of the sale were fully protected from the nursing home.  Additionally, the gain on the sale of the home was entirely tax free to their Protective Trust, just like they planned.  As a result of carefull planning, the Lowells were able to sell and close on the property, protect the proceeds from the sale, and avoid paying capital gains tax.

Failing to Review Your Planning: Common, Critical Mistake

Time passed and we did not hear from the Lowells for a few years. We tried to contact the Lowells’ son John, who had moved to California, to discuss the need to review planning in order to make sure that all of their life savings were coordinated with their Trust and protected from the cost of nursing homes, which cost $12,000 to $15,000 per month.  They never did get together to review things, and as time went on, John eventually contacted our office saying, “Dad isn’t doing too well, and he’s going to be moving to a nursing home.  The plan would be for mom is to stay in the house.”  At this point, we hadn’t reviewed things in a several years, though we had developed the “Lifetime Protection Program”, a membership program designed to make sure that the members’ planning is up to date, protects all of their assets and is going to work the way it was supposed to when executed.  Because of changes in the law, especially the new health care law and the coming estate tax changes, as well as changes in financial and personal circumstances planning needs to be monitored and maintained to make sure that clients are getting the best protection.  This is possible with the “Lifetime Protection Program” even as laws, families, finances, and personal circumstances change.  We reminded John again of the fact that reviewing planning crucial aspect of assuring that goals and objectives are accomplished.

Well, John said he’d get back to us, and a year and a half later we still hadn’t heard from him.  By this time, the Lowells had sold the home, Mom was in assisted living in the same complex where Dad was getting nursing home care.  The total cost was in excess of $16,000 per month.  The problem however, was that it turned out there was $550,000 that had not been put in their Trust, as we recommended, so it was not protected!  We contacted John and discussed a strategy to protect the $550,000.  It was difficult since John lived in California, and his sister had moved to Europe.  Because of the significance of the planning we were able to help.

Click Here to Download the Senior & Boomers Guide to Health Care Reform & Avoiding  Nursing Home Poverty

Crisis Planning to Protect Assets

It turned out that out of the $550,000 that had not been coordinated to the Asset Protection Trust, and if it was transferred now the five-year look back period would start all over again on the unprotected $550,000.  We learned shortly thereafter Dad had taken a turn for the worse, and was probably not going to be with us too much longer.  Learning about this, we introduced a special concept to the family, whereby the funds which normally avoid probate are coordinated with a testamentary trust.  Only then the funds are allowed to avoid the five-year look back period.  We quickly arranged to create a testamentary trust, which would protect the funds for Mrs. Lowell after Mr. Lowell died and eliminate the five-year look back period.

This plan was successful!  After Mr. Lowell passed away, a testamentary supplemental needs trust was established with the $550,000, which will be available for the lifetime of Mrs. Lowell, and would not be subject to claims of the nursing home.  Again, the family was grateful for what had been accomplished for Mrs. Lowell and the family. 

As time went on, Mrs. Lowell remained in the assisted living for a number of years after Mr. Lowell had passed away and both the proceeds from the sale of the house protected originally and the additional $550,000 were protected. 

Additional Resources Available for Massachusetts Seniors

Since our involvement with the Lowells, we have learned of even more special resources that may be available through Mass Community Health and other programs, which will allow seniors to continue to live in their home and community rather than a nursing home. One such program is for all-inclusive elder needs.  Others include PACE, SCO and the Frail Elder Program.  These new programs are available because nursing homes have become so costly and as a result of the fact that most people don’t need or want to go to a nursing home.  Increasingly we have been able to help families who prefer to stay in their home, or retire in a community or assisted living, rather than going to a nursing home with health assessments and guidance on finding the right care specialty or facility. 

Life Care Planning: What & How?

We’ve introduced a new service called life care planning for all of our clients that looks for the years ahead as to senior running into mobility and memories issues, both simply concerns as we all age.  Life care planning is a process that puts a long-term lens on the required planning that needs to become well ahead of time, in particular because the five-year look back, which most likely will be extended to eight or 10 years down the road.  If you know of a family member in need of assistance finding the right facility, getting the right care, or the like, it is important to be educated and informed about the importance of this planning and what could be accomplished with proactive, forward looking protection to protect spouses, homes, life savings.  For the long-term, there’s quite a bit that can be accomplished for families and their legacies. 

The purpose of Life Care Planning is to put people in control of their health care and living accommodations rather than be forced into a nursing home prematurely, just because that seems to be the only option.  People are much happier having options and control over their financial decisions, their health care, and their living situations. 

Are You Qualified for Additional Benefits Over $2,000/month?

In addition to the Mass Community Health programs there are a number of opportunities for Veterans.   Married Veterans may be eligible to receive over $24,000 a year.  Single Veterans may be eligible for $1,749 a month and widows of veterans approximately $1,100 per month.  If you think you may be eligible, it is important to act quickly, as there has been a bill introduced that would create a three-year look back period for veteran’s benefits. This is a big set back to veterans in need of assistance.

Massachusetts, VA Benefit, Aid & Attendance

Do Not Become a Statistic: Review & Update Your Planning

There exists a wealth of opportunity for those that are informed and proactive about their planning.  We’ve developed a unique 19-Point Trust Estate, Asset Protection Review Program to help people learn about opportunities to improve and enhance their planning so they don’t end up with on of the 86% of trusts that simply DO NOT WORK to accomplish the planner’s current goals and objectives. This failure rate is mainly attributable to the fact that plans are not reviewed, maintained, and adjusted as situations change.   Unaccounted for changes in the law, in personal health or financial circumstances, and even changes in families can cause a once effective plan to fall into the 86% that fail.  Don’t let that happen to you.  Call our office at 781-237-2815 to discuss the above situation or any of the following topics:

  • Life Care Planning

  • Save Investing for Seniors

  • 19 Point Trust, Estate, & Asset Protection Review and Guide

  • Complimentary DVD that explains why your living trust by itself will not protect you

About Our Team

At The Estate Planning and Asset Protection Law Center of Dennis Sullivan & Associates we help people and their families learn how to protect their home, spouse, life-savings, and legacy for their loved ones.  We provide our clients with a unique educational and counseling process so they understand where problems exist as well as where opportunities exist for significant improvement now as they implement plans for a protected future.  We even provide a Lifetime Protection Program to ensure plans continue to meet client & family objectives in the future, even with all of the changes in taxes, healthcare, personal and family situations.

Trust, Estate and Asset Protection Workshops

Click Here to Register For Our Trust, Estate & Asset  Protection Workshop

Come to a complimentary workshop to learn how protect you, your spouse, your family, your home, life savings and legacy. Register by calling 800-964-4295 (24/7) or visit us online at our website, www.DSullivan.com.

Tags: asset protection, Estate Planning, Elder Law, GST tax, gift tax, estate tax, estate tax savings, family, health Care act, Massacusetts Estate Tax

INACTION COULD COST YOU YOUR LIFE SAVINGS: TAKE STEPS TO AVOID NURSING HOME POVERTY

Posted by Massachusetts Estate Planning & Elder Law Attorney, Dennis B. Sullivan, Esq., CPA, LLM on Aug 20, 2012 1:13:00 PM

Changes in Health Care Law, Medicare, Medicaid, & MassHealth As Well As Estate Taxes…How do They Affect you?

The rules of paying for nursing home care can, quite frankly, get so complicated it makes your head spin! 

elder law, estate planning, health care reform, taxesWe find that many families want to cut to the chase and find out now what their own personal bottom line is.  If that’s you... if you want to know now how you might become eligible for protection and how much you might save, then call our office at (781) 237-2815 and let’s explore whether or not you’re likely to qualify and what you might be able to do if you would like to protect you spouse, home, and life savings.

If you stop for a minute and think about your retirement and life savings, you may have assets in lots of different places. MassHealth, however, focuses on dividing your financial assets into three different categories:  

1.      Available Assets; 2. Exempt Assets; 3. Unavailable Assets

What You Need to Know

Newton Couple Discovers Secret Protect Their Home & Life Savings  While Avoiding Payment  of Unnecessary Taxes

The main focus of MassHealth is the available assets.  This category is made up of assets that you could cash in and use for your own nursing home care. Available assets are also referred to as "countable resources." MassHealth views your available assets, the ones you should cash in and send every month to the nursing home, at a whopping $12,000 to $15,000 a month.

Most people do not have that kind of extra savings to pay for one or both spouses to go to a nursing home.  If one is in a nursing home, the couple’s life savings must be spent down to $115,000.  You read that right, if you do nothing, everything you own including your home, your IRA, and your entire life savings is at risk.  This is the government’s plan for your money.  It does not, however, have to be that way; you can override the government…but only if you take some important steps that many others have taken successfully to plan for their spouse and family.

The Good News: Planning Ahead & Taking Action Could Save Your Family Hundreds or Thousands of dollars

By taking action and implementing a Family Protection Plan, people and their families can avoid the required spend down, qualify for MassHealth, and still get the care they need.  Do you want your hard earned life savings taken from your spouse & family to pay for your nursing home care?  Would you rather leave a lasting legacy for your spouse, children, and grandchildren?  Call our office today at (781) 237-2815 to begin discussing how you can avoid nursing home poverty and protect what matters most: your spouse, home and life savings.  If you would like to attend a free educational workshop call (800) 964-4295 (24/7). 

 Click Here to Download the Seniors  Guide to Health Care Reform & Avoiding  Nuring Home Poverty

Will Medicare Pay for Your Alzheimer’s Care…Unfortunately, No!

One of the most common questions we are asked is, “Will Medicare pay for Alzheimer’s care?  The simple answer is, NO, the Medicare will not pay for long-term care expenses, but Medicaid will. As a result, the burden of financing long-term care is placed on you, your life savings, and your family.  If you do nothing, the cost of long-term care will come out of your pocket.  It is crucial that you take action to avoid having to spend down your assets to pay for long-term care.

Recent studies have shown one half of all people over 80 will develop Alzheimer’s or another form of dementia.  Because so many people are being diagnosed with Alzheimer’s or dementia, we have developed the free online resource center (www.BostonMemoryLawyer.com) to help people at every stage of the Elder Care Journey care for and protect their loved one with dementia or Alzheimer’s.

Recent Changes in the Law that Affect the Lives of Millions of Older Americans

With all the uncertainty in the tax law, the NEW HEALTH CARE LAW, shrinking federal and state budgets, combined with a growing senior population, a perfect storm is brewing.  More and more seniors are going to need care with less money available to pay for care.  An increasing number of seniors and families will be at risk of loosing everything to increasing health care and nursing home costs.  Did you know that according to recent estimates, released on July 24, 2012,  by the Congressional Budget Office, repeal of the new health care law would increase spending for Medicare by an estimated $716 billion over ther period from 2013 through 2022?

To learn more about how the new Health Care Laws affect older Americans, please see our new report, “Seniors Guide to Health Care Reform & Avoiding Nursing Home Poverty”, which contains information on the newly passed health care laws all seniors need to know.

What About How the Changes in the Estate Tax Law Will Affect you?

Additionally, significant estate tax changes are on the horizon.  The estate tax exemption, currently at $5,120,000, will be reduced to $1 million. On January 2, 2013, the current top tax rate of 35% will increase to 55%.  The Massachusetts estate tax exemption will remain at $1 million per person, with no portability.  These looming changes are an important aspect of planning to consider in reviewing or creating your estate plan. 

With all the changes in the law, finances, health, and personal circumstances, there is a tremendous amount of uncertainty.  It does not have to be that way.  If you'd like to understand how the changes affect you and your planning, as well as what steps you can take right now to protect you family, give us a call at (781) 237-2815. Our experienced team of caring and compassionate professionals can show you how MassHealth "sees" your life savings and if they will force you to spend them. We help families protect their lifesavings by transforming some of your "available" life savings into exempt, unavailable and even protected assets.

You Gain Understanding & Control

Research shows that 86% of trusts don’t work.  That’s why we developed our Unique Self-Guided 19-Point Trust, Estate, & Asset Protection Legal Guide, so you can learn where problems may exist in your planning as well as opportunities for improvement and how to implement a plan to protect your spouse, home, family, and life savings.  Click Here to Download the Guide.

Click Here to Download our Trust, Estate, & Asset Protection  Legal Guide

At the Estate Planning & Asset Protection Law Center, we help people and their families learn how to protect their home, spouse, life-savings, and legacy for their loved ones.  We provide clients with a unique educational and counseling approach so they understand where opportunities exist to eliminate problems now as they implement plans for a protected future, even with all these changes.

Register NOW for a Trust, Estate, & Asset Protection Workshop and receive a free Unique Self-Guided 19-Point Trust Estate & Asset Protection Legal Guide with a BONUS DVD  

Nursing home care is more than $140,000-$180,000 per year! Attend this FREE educational seminar to learn:  

  • How to protect your home and assets from the costs of long-term care

  • How to stay out of the nursing home and access in-home care

  • How to make sure your spouse is not left financially ruined if you need nursing home care

  • How to access Veterans benefits to pay for long-term care

  • How the MA & Federal Estate Tax Changes Affect You & Your Family

       To register call (800) 964-4295 (24/7) or online at www.SeniorWorkshop.com 

 

PS:  All those who attend a workshop will receive our new report, “Seniors Guide to Health Care Reform & Avoiding Nursing Home Poverty”, which contains information on the newly passed health care laws all seniors need to know.  

PPS:  The Elder Care Journey is difficult to navigate, but with the help of our team of trusted advisors to guide you, the trip becomes a whole lot easier.    Taxes and Health Care are important areas in which people and their families need to know who to trust. Click here to see what others are saying about their experience working with a team of dedicated, caring, passionate professionals at the Estate Planning & Asset Protection Law Center.

 

Tags: asset protection, elder care, Elder Law, budget cuts, Debt Ceiling, Estate Planning, GST tax, gift tax, estate tax

Will You End Up Like Terri Schiavo or in Court needing a Guardian & Conservator? | Massachusetts Elder Law Attorney

Posted by Massachusetts Estate Planning & Elder Law Attorney, Dennis B. Sullivan, Esq., CPA, LLM on Jun 28, 2012 8:48:00 AM


elder law attorney, Alzheimer's Dease Lawyer, estate planning, attorney, lawyer

You may have heard that guardianship and/or conservatorship as a bad thing - something to be avoided. In a perfect world, we could move through our lives from cradle to grave without such things as guardianships and conservatorships. But in order to achieve this perfect world, we have to do advance planning to provide for our own care if we become incapacitated. Also, we need trustworthy and responsible family members to assist us, if we need help.

As attorneys we are increasingly running into the following situations:

1.      Seniors come to us, often brought by their children or children-in-law, when mental incapacity has set in.  Although they appear to have willing and able family members who can take care of them, assist with making personal care and living decisions, or manage their finances, the seniors do not have the documents in place to empower these helpers as their agents. 

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If you need information and help to assist a family member with dementia or Alzheimer’s visit www.BostonMemoryLawyer.com where you will be given free online access to the Complete Alzheimer’s Resource Kit, a $197 Value. 

2.      Seniors have documents in place, but the people named are dead or no longer available, willing or appropriate to serve.  They may also be concerned about changes in the law, changes in their health, and changes in their financial situation.  It is good practice to review your financial and legal documents on a periodic basis.  To help clients keep up with changing situations we created the Life Time Protection Program, which provides clients with a yearly review, updates at no cost due to changes in the law, and the ability to contact our office with any questions or concerns they may encounter.  We help people make sure their critical health care proxy, HIPPA document, and list of emergency contacts are not only up to date, but available 24/7, anywhere in the world AND we pay for our clients to have access to this service because we believe it is so important. 

With important medical privacy laws such as HIPPA becoming more strictly enforced by hospitals and medical facilities, making sure you have the right authorization is more critical than ever.  Without proper authorization, your loved ones, including your spouse, children, and parents, may not be able to assist you when you need it most.  If you don’t have the proper authorization you may not be able to help loved ones when they need you.  Because of the strictness of HIPPA, it is more critical than ever that you have current and effective health care proxies, HIPPA release forms, and durable powers of attorney.  Clients should contact our office in order to review and update their documents over the mail or to schedule an appointment.

Crisis Situations

Another increasingly common situation is where seniors do not have agent-delegation planning in place and end up in a medical or living condition crisis where they are putting themselves or others at risk. Loyal family members and friends are very concerned, but nobody has the power to assist once they find out.  No one should end up like Terri Schiavo.  Ms. Schiavo did not have complete health care documents spelling out her wishes in the event of her incapacity or irreversible terminal illness.  Her husband and parents waged war through years and years of heartfelt legal battles…not to mention heartbreak, tears and hard feelings.  If you do not have the appropriate healthcare and disability documents your loved ones may be subjected to the same hardships as Terri Schiavo’s family in the event of your incapacitaty. 

Alternatively, seniors may have excellent voluntary delegation planning in place, but the seniors are noncompliant about what they now need to do for their own safety and care. For example, they may need to live in an assisted living community or nursing home, but they voluntarily check themselves out and depart. They are free to make their own decisions, even though imprudent or unsafe, so they can walk right out and put themselves in danger. If they have access to an automobile, they put the general public at risk as well.  If you or a parent would like to learn more about senior living options please contact our office at (781) 237-2815 and request information about Life Care Planning and Senior Living Options.  We have helped clients find the living situation that is right for them, and get the care they need without sacrificing their hard earned life savings to pay for it. 

Adult Protective Services

In emergencies, where the seniors are unwilling to cooperate and their intransigence is putting themselves or others at risk, often the first call should be to Aging Service Access Point (ASAP). ASAP is a state agency, typically within the department of "human services" or "elder services". ASAP generally will appoint a social worker or staff person to investigate, perhaps with local police in order to gain access to the senior and entry into the home.

Seeking Court Protection

Whether or not ASAP gets involved, and whether or not the case is an emergency or just a situation where the senior needs help and is not willing or able to sign voluntary agent-delegation documents, the solution is often a guardianship and/or conservatorship over the senior, if he or she meets the applicable standards of incapacity.

Guardianship

elder law, alzheimer's disease lawyer, estate planning attorneyTerminology varies from state to state, but in general, guardianship (sometimes called "guardianship of the person") applies to probate court appointment of a fiduciary ("guardian") to make decisions in regard to the protected person's personal care.  A guardian generally does not have control of the protected person's finances, although state law or the specific terms of the guardianship may authorize the guardian to hold small amounts of the protected person's funds if no conservator has been appointed and the protected person does not have a durable power of attorney.

Conservatorship

Conservatorship refers to probate court appointment of a fiduciary ("conservator") to administer the finances of the protected person. Conservatorship is much like trusteeship, although the powers of and restrictions on the conservator are defined by statute and regulation, rather than a voluntary trust agreement or trust declaration, and are typically are much less flexible than the powers authorized for trustees. Conservatorships are also analogous to durable powers of attorney. However, one of the key differences between conservatorships, trusts and durable powers of attorney is that conservatorships are court-supervised and directly accountable to the court. It is common for conservators to be required by state law and regulations to account annually to the probate court. Such accounting needs to be accurate to the penny.  

A conservator does not have plenary power to do whatever financial transactions he or she feels are warranted. For example, a conservator needs specific court authorization to sell real estate in most states.

Imposing Minimum Restrictions

For a guardian and/or conservator of an adult, the probate code generally imposes a standard that the protected person's rights are to be removed to the minimum degree necessary to protect him or her. This is because the removal of personal rights and liberty by the court is analogous to a civil form of imprisonment. Where a protected person is capable of making some kinds of decisions safely and prudently in regard to his or her living conditions, care, or finances, the theory is that his or her rights to make such decisions should be preserved as long as possible. On a practical level, keeping seniors involved in their care and financial decisions also helps to keep them engaged with life, reality, and higher mental functions, so this legal construct is very consistent with practical experience in care giving for seniors who are in a process of deteriorating mental capacity. There is a growing movement nationwide to maximize decision-making by adults who are under guardianship and/or conservatorship.

boston elder lawConclusion

Although attorneys correctly advise clients to plan to avoid unnecessary guardianship and conservatorship, there are many situations where a guardianship and/or conservatorship is appropriate and very beneficial. Court supervision in difficult cases can be beneficial to impose financial accountability and to bring about sound decisions for the care of a protected person. Under modern guardianship and conservatorship theory, courts impose the minimum restrictions on protected persons that are needed to accomplish the personal safety and prudent financial management that are the goals of these court-supervised protective measures.

Estate Tax Increase Pending

Since Massachusetts continues to tax all estates over $1 million, it is important to make sure your planning is current so that a completely avoidable estate tax is not triggered at the first death due to the TEMPORARY extension of the Bush estate tax law.  Please note however, that the temporary extension is set to expire at the end of 2012.  As a result, without congressional action a federal estate tax of up to 50% will also apply to all estates above $1 million after January 1, 2013.

Review & Update to Maintain Control of Financial & Health Care Decisions & Reduce Taxes

For clients, once we receive your information we will contact you to arrange for updates to be done via mail or to schedule an appointment to come in and to review your situation in person.  The entire process is quick and painless and you will have the peace of mind of know you are prepared for 2012 and beyond, even with the federal estate tax increase scheduled for January 1, 2013.  

Our team’s ultimate objective is to help you and your family to accomplish your estate planning and asset protection goals.  If you’ve recently signed your estate planning documents you are included in the Lifetime Protection Program at no cost for the first year.  If you have a friend or family member who would like our help please let us know!  If your friend or family member becomes a client you get One FREE YEAR Membership in the Lifetime Protection Program. 

If you have any questions or would like to discuss questions raised in this newsletter please feel free to contact our office. 

We encourage you to attend a free educational workshop hosted at the Estate Planning & Asset Protection Resource Center in order to learn more about how a review by our dedicated team of professionals can help identify problems in your existing planning as well as where opportunities for improvement may exist.  You CAN create a plan to protect your spouse, home, and life savings.  To register call (800) 964-4295 (24/7).

alzheimer's attorneyboston estate planning attorney, massachusetts

Tags: long term care, Alzheimer's Disease, Estate Planning, Lifetime Protection Program, elder care journey, durable power of attorney, Health Care, health care proxy, Elder Law, HIPAA, seniors, non-family caregivers

The Top Ten Mistakes in Estate Planning for 2012

Posted by Wellesley Estate Planning Attorney, Dennis B. Sullivan, Esq., CPA, LLM on Jan 24, 2012 2:42:00 PM

We enter 2012 with a roller coaster economy, elections, and changes in tax law as well as, medical and nursing home costs going skyward. All these changes together with the Baby Boomers retiring in record numbers and Alzheimer's disease at almost epidemic proportions, updating and maintaining your estate and asset protection plan is an absolute necessity.

In order to help families manage these changes and uncertainties, the Estate Planning and Asset Protection Law Center of Dennis Sullivan & Associates has provided the top 10 mistakes to avoid in estate and asset protection planning for 2012. For more information on how best to protect your life savings and eliminate these and other mistakes, attend one of our Trust, Estate & Asset Protection workshops by calling 800-964-4295 (24/7) or by registering online.

Mistake No. 1: Failing to Update and Maintain Your Estate & Asset Protection Plan

Statistics show that 86% of all trusts don't work often because the trusts were not maintained and updated to reflect current circumstances. Planning is an ongoing process because of the changes in our lives and the law. An estate plan should be reviewed on a regular basis to make sure it is protecting you and your family. That is why we created the 19-Point Trust, Estate and Asset Protection Review to help you discover where problems may exist in your planning and the opportunities you have to fix the problems before it’s too late. For more information on how you can review your own planning, refer to our 19-Point Trust, Estate & Asset Protection Guide, which is available on our website at www.DSullivan.com.

We also offer existing clients a Lifetime Protection Program to make sure their planning stays on track for the years ahead.

Mistake No. 2: Not Planning to Avoid Probate

"I have a Will...I'm all set"...

A will alone does not avoid the probate process; actually, it guarantees it. In Massachusetts, the probate process takes a minimum of 1 year; it is also public, so family and financial matters become public record. Probate can be avoided by executing and funding a trust. Trusts are extremely flexible estate planning documents that should be considered as part of your estate plan.  Trusts can also provide disability planning where a will cannot.

Mistake No. 3: Not Coordinating Your Assets to Your Trust(s)

Not coordinating investments and other assets to a trust means that probate will not be avoided. Probate is the process by which assets of a deceased person are passed to those who will inherit them. The probate public process can take up to one year and can be very expensive. By properly coordinating your assets to your trust, you can avoid probate and save your family time and money.  For many who have created a trust, they miss the critical step of properly coordinating their home and investments to their trust.

Mistake No. 4: Not Reviewing Your IRAs and Investments To Make Sure They Are Safe and Productive for You Based on Your Age and Objectives

Whether you are growing your savings to fund your retirement or are in retirement, it is important to manage your investments and minimize your investment risk.  With the current economic climate you want to make sure now more than ever that you have an investment program designed especially with your goals and safety in mind.

For more information on trust and investment management, please call our office 781-237-2815 to request a copy of our DVD series, "Safe Investing for Seniors," which we provide as part of our educational series for members of the Lifetime Protection Program.


Mistake No. 5 Not Planning for Disability

If you become disabled, what will happen to your family? Who will make your financial decisions? If the proper disability documents are not part of your estate plan, your family may be forced to go to court to appoint a guardian or conservator just to be able to participate in your health care and financial decisions. If you have executed the proper documents years ago but have not updated them, your family could still be forced into court. Many of the top hospitals in Massachusetts do not accept disability documents that are more than 1 year old. The most effective way to avoid these issues is to plan ahead with a trust that will provide for your family financially if you are disabled and to have current disability documents.

Mistake No. 6: Not Planning to Avoid State and Federal Estate Taxes

A trust is an effective way of doubling the amounts that a married couple can pass tax-free to their children and grandchildren. The federal estate tax-free amounts are constantly changing. The exemption amount is scheduled to drop to $1 million per person in 2013, unless it is changed before then. It is important to consider how the growth of your assets over time will effect your tax situation. The state of Massachusetts also imposes a separate estate tax on all estates over $1 million. Therefore, for both federal and Massachusetts purposes it is important to utilize the tax-free amounts, up to $2 million for a married couple, but it is not automatic. Your planning should address both state and federal estate taxes, which can be substantial.

Mistake No. 7: Not Considering the Potential “Double Taxation” on Retirement Benefits

Taxes on IRAs and other retirement benefits can be as high as 70% before your children or grandchildren can collect a cent. This is because IRAs and other retirement benefits are taxed once as part of your taxable estate and again as income when the money comes out of the fund. By planning to avoid this “double taxation” you can stretch out and protect your IRA and retirement benefits, create tax savings, and increase the growth of the fund.

Mistake No 8: Not Planning to Avoid the Cost of Nursing Home Care

One out of every three people over 65 and one of every two people over 80 will need nursing home care for some period of time. Increasing health care and nursing home costs are one of the greatest threats to a comfortable retirement. In Massachusetts, nursing home care costs range from $12,000-$15,000 per month, $144,000-$180,000 per year. Because long-term care is so expensive, many families have elected to execute a Protective Trust to keep their life savings from the reach of a nursing home and protected for the spouse so they avoid nursing home poverty.  For additional reports and guides on avoiding nursing home poverty, please visit our website www.DSullivan.com.

Mistake No. 9: Believing Estate Planning is for The Elderly

No one can predict what will happen or when, and as the saying goes, “It’s better to be safe than sorry.” Not executing basic estate planning documents can cost your loved ones time and money. To take the first step in protecting you and your family visit www.DSullivan.com and register for a free educational workshophosted by the estate planning and asset professionals at Dennis Sullivan & Associates. Upcoming workshops will take place at 10AM and 2PM on Thursday, February 2; and Friday, February 17. Check our website for future dates and times as well as helpful educational reports, guides, videos and other resources such as CDs and DVDs.

Mistake No. 10: Not Planning to Protect Children and Grandchildren's Inheritances

Any significant gift or inheritance raises the question of whether the recipient will be able to have full enjoyment after the transfer, given considerations relating to potential creditors, divorce, or lawsuits against a beneficiary. Is the beneficiary able to handle investment and spending decisions, and will the beneficiary be subject to pressure from a spouse or other individual to place the assets into joint names, to make gifts that they might not otherwise want to make, or to make high-risk investments or loans?

If it has been a while since you’ve created your estate plan or even if it has only been a couple of years, you owe it to yourself and your family to find out if your plan is going to protect you and them when you need it.  Eliminate ALL these above-mentioned, common mistakes and misconceptions by scheduling a Trust, Estate & Asset Protection review based on our unique, 19-point review process to make sure you have protected your home, spouse, life savings and legacy for 2012 and beyond.

For additional educational information call us at (781)-237-2815, to request our latest DVD on "Life-Care Planning and Safe Investing for Seniors", register online or call 800-964-4295 (24/7) to attend a Trust, Estate and Asset Protection Workshop where the 19 Point Self Guided Trust, Estate and Asset Protection review process will be discussed.  We are hosting educational workshops on the following dates:

 

            Thursday, February 2 @ 10 a.m. and 2 p.m. 

            Friday, February 17 @ 10 a.m. and 2 p.m.  

            Thursday, March 1 @ 10 a.m. and 2 p.m.

 

We look forward to hearing from you. 

 


Tags: Protective Trusts, Alzheimer's Disease, asset protection, Estate Planning, Lifetime Protection Program, Mistakes, Nursing Homes, probate

What Resources Are Available for The Alzheimer's Family?

Posted by Wellesley Estate Planning Attorney, Dennis B. Sullivan, Esq., CPA, LLM on Nov 7, 2011 4:25:00 PM

With the number of families affected by Alzheimer’s Disease growing daily, it is becoming vital information for almost everyone to learn how to manage this dread disease and its far-reaching ramifications.   

What Are The Predictions? 

Latest studies indicate that the number of Americans with Alzheimer’s Disease could double by 2020 (9 million people) and quadruple (to 16 million) by 2050.

What To Do.

The first step is to tap available resources and become informed about the disease.  The Alzheimer's Resource Kit  (retail value of $197) can be downloaded free and is an invaluable source of information for the patient, family, and caregiver. 

Next, it’s important to build a support network that may include other families dealing with Alzheimer’s, relatives and friends.  Individuals who are suffering from memory loss and their families should, of course, also address the health-related issues with their doctors. While there is no cure yet for Alzheimer’s, there are a variety of treatment options and significant research continues.

Another crucial step is estate and asset protection planning with a reputable elder law attorney. Establishing powers of attorney for both health care and financial matters is the only way a family member can legally make decisions for a loved one if he or she becomes mentally incapacitated. There are multiple other legal issues to discuss during the Alzheimer’s estate planning process, and each individual’s needs vary.

How To Pay for Alzheimer's Care?

Medicare is a type of public health insurance for age 65 and older.  However, Medicare does not pay for long-term care. The criterion is that there must be some actual improvement to your condition. Since diseases like Alzheimer's and Parkinson's have no known cure today, rehabilitation is not possible, so Medicare will not pay.

Unlike Medicare, Medicaid will pay for Alzheimer's, Parkinson's, or dementia-related diseases, or a decline in functioning due to the aging process. You must, however, exhaust all your resources (including your spouse's) before you will be eligible, that is unless you take steps to protect your home, spouse and life-savings so you can avoid nursing home poverty. We can help. To learn more, call our office.  In addition, visit our website, www.DSullivan.com to download our free elder guide The Massachusetts Elder Guide to Medicaid, Nursing Homes and Asset Protection or watch our educational video on "How To Avoid Nursing Home Poverty."

Take Control - Establish A Life-Care Plan.

With longevity, comes expense.  (We are all living longer and may have many years ahead of us post-retirement, so it is all the more important that we plan ahead for those years.) Life-care planning is an integrated planning approach that addresses the health care, legal, and financial issues of aging and disability.  As such, it is critically important for seniors and their families to begin talking about a life-care plan.  If executed properly, a life-care plan can save seniors and their families lots of trouble and heartache.

The goals of a quality life-care plan include, maintaining the health and well-being of your loved one; assessing long-term care options in the home and outside the home; identifying all sources of income available to pay for care; obtaining eligibility for public benefits programs like SSDI, VA, and Medicaid benefits; protecting assets.   In addition, the life-care plan provides the services of a Geriatric Care Manager (GCM) to assist with the development and implementation of the plan.  It also provides assistance with living arrangements and placements, coordination  of available community resources as well as working with the family to provide support, guidance, and advocacy.

What Are The Special Benefits for Veterans?

The Veteran's Administration (VA) has reported that thousands of Massachusetts veterans may not be receiving the disability benefits they deserve.  One of the VA's best-kept secrets, which is an excellent potential source of funds for long-term care, is a veteran's benefit for non-service connected disability.   

Most VA benefits and pensions are based on a disability that was incurred during a veteran's wartime service.  This particular benefit, however, is available for individuals who are disabled due to issues of old age, such as Alzheimer's, Parkinson's, multiple sclerosis, and other physical disabilities and have the additional requirement of needing the aid and attendance of another person in order to avoid the hazards of his or her daily environment.  

These benefits can be a blessing for the eligible disabled individual who is not yet ready for a nursing home.  A veteran married to another veteran can receive a maximum of $1,949 per month in benefits and a widow can receive up to $1,056 per month (for the year 2011).  The applicant must be “permanently and totally disabled” based on VA standards, which means  he/she need only show that he/she is in need of aid and attendance on a regular basis.  Someone who is housebound or in an assisted living facility and over the age of 65 is presumed by the Veterans Administration to be in need of aid and attendance. 

For more about these benefits, download our free guide entitled, "The Nuts and Bolts Guide to Veterans Benefits".  If you have questions, please call our office 781-237-2815.  To learn more about how to protect yourself, your spouse, your home and life-savings from increasing medical and nursing home costs, you may register online or call 800-964-4295 (24/7) to attend one of our Trust, Estate & Asset Protection Workshops.  Upcoming dates in Wellesley are as follows:

Friday, November 18 @ 10AM & 2PM   

Thursday, December 8 @ 10AM & 2PM

Thursday, December 15 @ 10AM & 2PM.

Tags: Medicare, Alzheimer's Disease, asset protection, Medicaid, veterans benefits

Top Strategies for 2011 Mid-Year Tax Review and Life-Care Planning

Posted by Dennis Sullivan & Associates on Jul 22, 2011 12:23:00 PM

There are many reasons to consider a mid-year tax and financial review.  At this time last year, income tax planning was particularly challenging.  As a result of mid-December's last-minute legislation, which renewed many already expired deductions, there is much less uncertainty involved in tax planning for 2011. 

As such, you might consider that a mid-year review provides you more time to plan as well as to implement tax or other savings steps.  In this newsletter, we shall discuss important mid-year tax and financial planning topics.  Another very important area to consider is your Life Care Plan.

2011 Mid-Year Income Tax Plan

Federal Income Tax Rates.  The same 6 federal income tax rates that applied in 2010 will continue to apply through 2012.  So, depending on your taxable income, you’ll fall somewhere between the 10% and 35% bracket.   

Long-Term Capital Gains & Qualifying Dividends.  Long-term capital gains and qualifying dividends will continue to be taxed at a minimum rate of 15% through 2012; if your income (including any long-term capital gains and qualifying dividends) puts you in the 10% or 15% income tax bracket in 2011 and 2012, a special 0% rate will usually continue to apply.

Alternative Minimum Tax (AMT).  While regular income tax rates and the maximum rates that apply to long-term capital gains and qualifying dividends were extended through 2012, the latest AMT “fix” (increased AMT exemption amounts) is effective only through 2011.  So, if you may be subject to the AMT this year, you alreadt know what the relevant exemption amounts will be ($74,450 for married filing jointly, $48,450 for unmarried individuals, $37,225 for married filing separately); howeve, the AMT for 2012 is unclear.  There will probably be another AMT fix later in the year, but for now, AMT exemption amounts will show sharp decreases in 2012, significantly increasing the number of taxpayers caught in this parallel tax system.

Life Care Plan  

Life-Care Planning is a new area of law that helps families respond to the challenges of long life, illness and disability.  A life care plan includes the following:

  • Legal care, wills, trusts, powers of attorney and advanced directives; Medicaid planning; guardianships; and protection of the elder's right to safe and effective care.
  • Care coordination, including locating in-home care, nursing home care, family education and decision-making support - for the rest of your loved one's life.

Learn more about the benefits and our recommendations for the best way to approach your life-care plan.  It is critically important for seniors and their families to begin talking about a life-care plan because circumstances in life can change quickly, and if there are no plans in place, a stroke, dementia or other life-changing situation could occur suddenly, robbing you of your ability to make end-of-life financial and estate planning decisions.  A properly executed life care plan preserves the wishes of the planner and gives his/her family peace of mind, knowing those provisions will have already been secured.  Obviously, this kind of forward thinking goes hand in hand with conducting a mid-year financial and tax review.

Client Workshop for Life-Care Planning

On July 26 at 2PM at The Wellesley College Club we are inviting our clients and their guests to learn more about life-care planning from three guest speakers on topics including:  aging at home, assisted living options and financial considerations for retirees.

Where To Begin?

A good way to start your mid-year planning is to identify personal circumstances that may have changed:  marriage, divorce, births, deaths, retirement, career change, changes in income or anticipated changes in income and expenses, including medical expenses, investment performance, etc.

Improved Tax Planning

A mid-year check up on your tax liability will provide more tax-planning opportunites for you than rushing to plan for your taxes at year’s end.  Using last year’s tax return, you can make adjustments to your income and deductions for this year.  By then it's too late.  If you owed taxes or received a refund last year, you might want to adjust your estimated tax payments or withholdings or your retirement plan distributions.  This is also an excellent time to make sure you’re saving necessary receipts and other documents now to avoid a scramble at the end of the year.  Consider the contributions you are currently making to your retirement plan.  Have you evaluated your required minimum distribution requirement?  If you have a traditional IRA, would now be the time to convert it or part of it to a Roth?

Life Planning for Financial Considerations

If you have already retired, will your current plan provide you with enough income over the long term?  If you are concerned about running out of funds, you may consider a lifetime annuity which will pay you and your spouse for the rest of your life.  You may also want to evaluate whether a reverse mortgage makes sense for you.  What are your Social Security strategies?  Would you benefit from using the “file-and-suspend” option?  These are just some of the considerations to review as part of your life care plan.

Investments?

Would now be a good time to consider rebalancing your portfolio?  Are your investments safe and productive?   Maybe now is the time to consider a review of your investments not only to make sure they are coordinated with your trust, but also to see if they fit your current needs and long-term health plan.  

What About Insurance?

Do you know the terms and the amounts of all your coverages:  house, life, auto, etc.?  Has your insurance kept up with your personal circumstances?  What about life insurance?  Long-term care insurance?  If you’re married, have you considered sharing a long-term policy instead of purchasing two individual ones?

As you can see, there are so many different areas that you can review and improve if you really undertake a review of your “financial and tax situation.”  Certainly leaving all this work to the end of the year is risky, particularly with so many things changing these days and so many different strategies and programs potentially available to you that could significantly improve your financial and/or tax picture.

For additional information and education about your tax, financial and life care plan options, call us at 781-237-2815, or attend a Trust, Estate and Asset Protection workshop by calling 800-964-4295 (24/7) or registering online (www.DSullivan.com).  We are hosting educational workshops at 10AM and 2PM on the following dates:

            Thursday, August 18

            Thursday, September 15

            Thursday, September 29

To learn more about tax planning, retirement strategies and estate planning, visit our website to watch Dennis Sullivan discuss these topics on the national talk show, “Leading Experts.”  

 

Tags: life-care plan, Retirement, Financial Planning, taxes

Will Medicare and Social Security Be There When YOU Need Them?

Posted by Dennis Sullivan & Associates on Jul 8, 2011 1:18:00 PM

Approximately 55 million retirees, the disabled, and children who have lost parents receive Social Security benefits. More than 46 million Americans are covered by Medicare. As the number of new Medicare and Social Security beneficiaries rises sharply with the upcoming wave of retiring Baby Boomers, can these programs continue to be viable?  Experts predict that Medicare will be exhausted by 2024 and Social Security will be bankrupt in 2036.

"The financial shortfalls confronting both Social Security and Medicare are substantial and -- absent legislation to correct them -- quite certain," wrote Charles P. Blahous III and Robert D. Reischauer, two trustees of Social Security and Medicare.   "Elected officials will best serve the interests of the public if financial corrections are enacted at the earliest practicable time."  Solutions that are undertaken early can be more of a gradual cure as opposed to last-minute, painful remedies like high tax increases and deep benefit cuts.

What’s Happened?

The sluggish economy is hurting Medicare and Social Security because fewer people are working and contributing payroll taxes that fund these programs.  Medicare also suffers the high cost medical care.  In addition, people are living longer and having costly procedures like bypass surgeries and hip replacements later in life.

What Does Medicare Cover?

Medicare is our countrywide health insurance program for people 65 or older and is financed by payroll taxes paid by workers and employers.  It is also partially funded by monthly premiums deducted from Social Security checks.  Medicare assists with the cost of health care but does not cover all medical expenses or most long-term care. The program has 4 parts:

  • Hospital Insurance:  for inpatient care, some in-home care and hospice care;
  • Medical Insurance:  for doctors' services and other miscellaneous medical services and supplies not covered by hospital insurance;
  • Medicare Advantage:  These plans are available in many areas so that people with Medicare Parts A and B can choose to receive all their health care services through one of the provider organizations under Part C.
  • Prescription Drug Coverage:  for doctor prescribed medications.

What Is The Government’s Response?

American seniors have worked hard, contributing to Medicare and Social Security for decades.  With the looming U.S. deficit at issue, however, those benefits are now at risk because Congress is considering dangerous cuts to Medicare and Social Security.  There are many efforts in place to fight for cuts to be made to wasteful government spending instead of hurting these valuable programs.

According to reports, the Social Security benefits for disabled Americans and their dependents would be the first to dry up with funding scheduled to run out in 2018.  The part of the fund that pays retirees, however, has enough money to stay solvent until 2036.

If nothing is done to remedy this before then, benefits will have to be cut by 23 percent or the Social Security payroll tax increased to16 percent or some combination of the two.   

Recommendations?

For future planning, the best advice for maximizing Social Security benefits is to continue to work as long as possible and to delay retirement to age 70, if possible.  It is also a good idea to have some long-term care insurance - just in case.

Along with this, understanding strategies that married couples should use is key.  Many people benefit from claiming later and too many claim early – not usually a good idea.  In some instances, the lower-earning spouse should claim as early as possible and the higher-earning spouse as late as possible.

To get an idea of your monthly Social Security benefit, login to the Social Security website. (Visit the Social Security Administration’s benefit calculators website.)  Also, read The National Academy of Social Insurance’s report, ‘When To Take Social Security: Questions to Consider.’ (Read the report from the National Academy of Social Insurance here.)

For Medicare to remain viable for the next 75 years payroll taxes would have to be increased by 24 percent or current benefit payments cut by 17 percent.  The longer the US waits to address the pending shortages in Medicare and Social Security, the more painful it will be.  Delaying good fiscal planning for Medicare’s future now may mean cuts for current beneficiaries rather than diminishing them for people who enter the program in the future.

This could mean that by age 65 or older the average individual could need $300,000 set aside for medical expenses and $300,000 for long-term care if you do not buy a long-term care insurance policy. 

The bottom line here is simple.  Social Security and Medicare will probably be around for many years to come; however, these programs should start to be viewed as supplements rather than primary sources of retirement income and health insurance. 

To learn more about your options, call us at 781-237-2815 or to attend an upcoming Trust, Estate & Asset Protection workshop, call 800-964-4295 or register online .

For more information on how you can plan ahead to maximize your retirement earnings and protect your assets, visit our website to download our free guide on “The 7 Biggest Mistakes in Retirement & Estate Planning.” 

 

 

Tags: in-home care, long term care, Medicare, social security, Retirement, Nursing Home Costs