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How to Protect Your Assets from Paying for a Nursing Home

We have all heard stories about how expensive nursing home care is, but hoping that you don’t ever need that type of long-term care is not enough. If you want to prevent your life savings from being used to pay the nursing home while also qualifying for government assistance, it will take a significant amount of pre-planning.

Medicaid has restrictions on when and how you can gift your assets in order to qualify for assistance. Certain transfer penalties can be applied. The general transfer penalty law has a five-year look-back period, so the sooner you start your planning, the better off you will be.

Below are three suggestions on how to pre-plan your gifting of assets while also retaining sufficient wealth to provide for your care during the five-year look-back period:

  1. Early inheritance. If you can afford to give your children a portion of their inheritance while retaining sufficient assets to privately pay for any necessary long-term care during the five years, it can be an effective means for protecting your assets and your loved ones. It also allows you to see your beneficiaries enjoy the money while you are still alive.
  2. Longterm care insurance. If giving an early inheritance to your loved ones is not feasible for you, purchasing long-term care insurance is an option to consider. It is important to research the long-term care insurance policies and make sure you truly understand what is and is not covered.
  3. Asset protection trust. An asset protection trust is often a very advantageous option for you and your family. You can transfer property into a Medicaid irrevocable trust that will safeguard your assets from being vulnerable to paying for nursing home expenses. You should discuss whether an asset protection trust would be beneficial for you with one of our experienced estate planning attorneys.

The above three options are just a few considerations if you are concerned about the costs of long-term care. The sooner you begin your asset protection planning, the easier it is for us to find the most beneficial means for protecting your family and your assets.

The Astill Law Office has provided high quality legal services for over 30 years. We specialize in wills, trusts, estate planning, and asset protection. If you have any questions about creating a Trust, Will, or estate planning in general, contact The Astill Law Office at 801-438-8698.