Nursing home and other forms of long-term care are extremely costly. If you’re not careful in planning for how to pay for this care, then your estate can quickly erode, eating away at the wealth that’s taken you decades to build. This, in turn, can rob your loved ones of the inheritance you wanted for them, and the inheritance that they expected.
You might be thinking that you’re not going to need nursing home or other long-term care, but statistics aren’t in your favor. In fact, some studies show that 60% or more of people who live to the age of 65 end up needing long-term care at some point in their lives. So, if you want to get out ahead of the potential costs that you could be facing, when do you start planning?
Start planning for Medicaid coverage now
One of the most effective ways to cover your long-term care costs is to engage in Medicaid planning. Here, you manage your assets in a way that reduces what you owe so that you meet federal eligibility requirements for Medicaid. This allows you to shield some of your wealth for the purpose of passing it down to your loved ones while allowing the government to help you pay for your long-term care needs.
If you think that type of planning might be beneficial to you, then you need to figure out when to start the process. Here are some things to keep in mind as you do that:
- You can’t wait until your health starts to decline: Medicaid eligibility has a five-year lookback period. So, when you apply for Medicaid coverage, the government is going to see how you’ve transferred assets over the last five years. If they suspect that you’ve spent down or given away assets during that period to qualify, then you’ll be penalized and could be left without the resources you need to cover your care. Make sure you start the Medicaid planning process early on.
- You need viable legal documentation: Even if you start your Medicaid planning early, you jeopardize its validity by haphazardly managing your assets. Doing so could cause you to lose control over where your assets go once you pass away, and it might restrict your ability to use them during your lifetime. Inadequate planning can also cause you to miss out on the Medicaid benefits that you need.
- Your options are limited: Given the expense of long-term care, there aren’t many options out there to help you cover the costs. You might be able to rely on a long-term care insurance policy or your savings, but most people don’t have enough to cover their needs. So, even if you’ve never thought about Medicaid planning, you should start assessing it now to determine if it’s a good option for you.
That said, the best time to start Medicaid planning is now. Don’t wait until it’s too late.
If so, then be sure to seek out the answers. Remember, this is your future. Take it into your own hands by figuring out the best way to protect your interests and shield your wealth from the extraordinarily high costs of long-term care.