Elder law attorneys help clients address the eventualities of aging from a legal and financial perspective. It is difficult to make projections about the future, but you should understand the cold hard facts so you can make informed decisions even though it is an imperfect science.
When you are planning for your active retirement years, the picture may start to come into focus eventually, but there is another dimension that people sometimes overlook.
The overall life expectancy in the United States is about 78 years, but this includes people that pass away at all ages. As you get older, the figure goes up.
You will become eligible for your full Social Security benefit when you are between 66 and 67 years of age depending on your birth year. The longevity expectation for a 67-year-old man is 85 years, and it is 87 years for a 67-year-old woman.
Clearly, there are challenges that may present themselves when you enter the ranks of the oldest old.
The Alzheimer’s Association provides resources and information for people that have been touched by the disease and those that want to gain a better understanding of it. They have found that over 30 percent of individuals that are 85 years of age and older have Alzheimer’s.
This is not the only cause of cognitive impairment, so this is a looming threat. When you combine the longevity statistics with these inconvenient truths, the potential challenges start property focus.
Your estate plan should include an incapacity planning component to address the realities that go along with aging. Advance directives for health care will be a major part of the equation.
With a living will, you state your life support preferences, and you can add organ and tissue donation and comfort care medication choices. A durable power of attorney for health care should be added to name a representative to make medical decisions for you.
These would be decisions that are not related to the use of life-support. The choices that have been asserted in the living will would definitely be honored, and your representative would not be able to override them.
For financial decision-making, you can name a disability trustee if you have a living trust. A durable power of attorney for property can be added to account for property that is not held by a trust.
Nursing Home Costs
Many people with dementia ultimately reside in nursing homes, and there are other reasons why elders require nursing home care. Medicare does not pay for the custodial care that nursing facilities provide, and the cost for a year in a Los Angeles area nursing home is over $100,000.
Fortunately, there is a solution the form of the Medi-Cal program. It will pay for long-term care if you can gain eligibility, but there is a $2000 limit on countable assets.
You can divest yourself of assets with Medi-Cal eligibility in mind if you establish and fund an irrevocable Medi-Cal trust. While you are living independently, you would be able to receive distributions of the trust’s income, and this can help to facilitate a comfortable lifestyle.
If you do in fact need long-term care, the assets in the trust would not count as long as you fund the trust at least 30 months before you submit your application for Medi-Cal.
We Are Here to Help!
Our doors are open if you are ready to develop intelligent plan for aging that culminates in the effective passing of your legacy. You can schedule a consultation at our Los Angeles elder law office if you call us at 310-337-7696, and you can fill out our contact form to send us a message.