Estate planning can be a challenging topic for many people to embrace. Not only can it be frightening to consider what will happen to your assets after you pass away, it can be difficult to think about how you will pay for the care and attention you need as it gets harder and harder to fend for yourself.
Medicaid planning can be a complex endeavor requiring time-consuming record keeping and fastidious attention to your finances. That said, there are five important factors to keep in mind . . . things that you might have misheard or misinterpreted along the way. As always, it’s important to discuss your unique situation with an attorney who can answer your questions and alleviate your concerns.
Myth #1: I must dispose of all of my resources to be eligible for Medicaid.
While the goal is to convert a significant portion of your assets to cash holdings, certain resources are exempt from eligibility requirements. These resources can include one vehicle, household furnishings, personal property, business property that is essential for self-support and other assets that can be shown not to be convertible to case. Additionally, under certain circumstances, the family residence is also exempt.
Myth #2: Transferring my assets will always hurt my eligibility.
Typically, transfers between spouses are exempt, but transfers to other family members or close friends might result in a penalty. To learn more about transferring assets, it’s wise to discuss your specific situation with an elder law attorney.
Myth #3: I can’t plan for Medicaid since I’m in a nursing home already.
While it’s true that you have a better chance of creating a proper plan the earlier you start the process, the truth is that you can plan for your future at any time.
Myth #4: Putting all of my money in my spouse’s name will improve my eligibility for Medicaid benefits.
When determining financial eligibility, the assets of both spouses are used.
Myth #5: All of my income will go toward my spouse’s nursing home bill.
Like most of this list, the myth isn’t true, but the truth is complex. We always recommend making your financial decisions based on the guidance of a legal professional. In general, each spouse’s income is considered separate property. Certain jurisdictions, however, might require some measure of support.