Stay Financially Independent and Protect Your Assets

Long-Term care involves a loss of personal and financial autonomy.  But proper planning can help you retain your financial independence, while also reducing or eliminating stress for your loved ones. 

In Florida, nursing homes cost about $9,500 per month. Most people end up pay out of their savings, and when they run out, Medicaid picks up the cost.  But it doesn’t have to be that way.

Medicaid rules require that one be “impoverished” before Medicaid will pay for some or all of one’s care.  And if you voluntarily “impoverish” yourself within 5 years of applying for Medicaid, you probably won’t be eligible.  So, what to do?  

You should plan to protect your assets for you, your spouse, or children.  This way, when you do need long-term care, and most over 65 years of age will, you could qualify for Medicaid benefits without losing your life’s savings. 

The best way to plan is to create a "Medicaid Asset Protection Trust.”  While this type of trust can’t be revoked, it can be cancelled or changed in many respects.   In most cases, this type of trust is drafted so that the income is payable to you, but the principal cannot be given directly to you or your spouse.  However, the principal can be given to anyone that you choose.  So, the funds in the trust are protected, and you can use the income for your living expenses. At your death the principal is paid to your loved ones and/or charity.  The assets in the trust are not counted by Medicaid when determining whether you are “impoverished.”  But this strategy will work best if the trust receives your assets at least five years before applying for benefits. 

So, plan NOW to protect your assets!