Can estate planning help me protect my assets from nursing home costs?

old lady with nurse nursing home

In today’s society, nursing home costs are enough to drain an individual as they are overly expensive. It is critical to note that each year you spend living in a nursing home or assisted living facility detracts from the value of your estate. Therefore, the more nursing home costs you incur, the fewer assets you’ll have to leave to your loved ones. However, while you are estate planning, you can strategically protect your assets by minimizing the impact of nursing home costs. Please continue reading and contact an adept Montgomery County Estate Planning Attorney who can help you preserve your assets for your loved ones. 

How can I protect my hard-earned assets from nursing home costs while estate planning?

One of the primary ways to protect your hard-earned assets from nursing home costs is by applying for long-term care insurance. A long-term insurance plan will provide you with additional funds to pay for the services offered by the nursing home. Essentially, this type of insurance policy will cover nursing home costs. However, in return, the policyholder must pay monthly premiums. Ultimately, long-term care insurance will help you remain financially independent. Medicaid is a widely known health insurance available to assist low-income individuals. Therefore, you may have to spend a substantial amount of your assets to qualify for this type of insurance. With a long-term care insurance plan, you can hold onto all your assets and still receive needed financial support to cover nursing home costs.

However, Medicaid can be helpful if you turn your assets into income with a Medicaid-compliant annuity. Make the strategic purchase of a Medicaid-compliant annuity. You can decrease the value of your help and qualify for Medicaid benefits without spending your hard-earned assets. When you buy a qualifying annuity, you will deposit cash with a provider. In investment, that annuity will be returned to you through various payments. When you make your initial deposit, the value of your assets will be reduced and returned as income. Overall, this will lower your income, making the sum of your assets enough to qualify for Medicaid benefits.

Furthermore, creating a life estate that will allow you to transfer ownership of your estate to another person is also beneficial. However, despite relinquishing ownership, you retain the right to live in the property for the entirety of your life. When you pass away, the person you left you transferred your property to will retain full ownership. A life estate is not accounted for when calculating the total value of your estate. Therefore, when you apply for Medicaid, this can help you qualify for it without spending down.

To protect your assets from nursing home costs, contact a determined attorney from JD Katz today who can help you preserve the legacy you have managed to build throughout your lifetime.