The Elrod Firm


It’s Too Late to Plan. Now What? (Part 2)

Justin, I have talked to my mother for years about signing a will and power of attorney documents, but she was never interested in thinking about those types of things. Just last week, she received a diagnosis of dementia from her doctor. I assume it’s too late to plan her estate now—what do we do? – Pam

Pam, Last week I explained that it may not be too late for your mother to do some basic estate planning, despite her diagnosis of dementia. But I also mentioned that you should now look into long-term care planning.

Long-term care broadly means any type of home care, assisted living, or nursing home care a senior might need as a result of age or illness. I’m sure I don’t have to tell you that long-term care can be extremely expensive, and I’m sure your mother would prefer not to pay for the care she’s likely to need out of pocket until all her assets are liquidated and her hard-earned savings are gone.

There are a couple of long-term care benefits available to help cover the costs of long-term care—veterans’ benefits and Medicaid—but both have income and asset restrictions. If your mother has assets in her name but is likely to need expensive long-term care services in the future, you would be wise to look into legally sheltering those assets before care is needed.

One way to shelter assets involves the use of a trust instead of a will, but not just any trust will do. If you are concerned about long-term care expenses, only a very specific type of irrevocable trust will help shelter assets. Don’t count on a revocable trust to protect your assets from long-term care costs.

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