Annapolis, Maryland Wills, Trusts & Estate Planning

Taking Control After Alzheimer’s By Planning for Care Costs - Annapolis Estate Planning

Facing Alzheimer’s is never easy. The impacts of this condition can be felt in every area of life, and it can be hard to escape the added stress. While there is no easy fix for dealing with the repercussions of Alzheimer’s, there are ways to plan ahead to cope with and cover the costs of care.

Budget for Care and Insurance Costs

Regardless of whether you have a family history of Alzheimer’s, you should still make an effort to prepare for long-term care when planning for the future. Even without an Alzheimer’s diagnosis, long-term care is almost an inevitable part of every senior’s future, so it makes sense to include this kind of care in your financial planning. Doing so helps you avoid unpleasant surprises, like finding out that Medicare will not cover the care you need.

Contrary to popular belief, Medicare offers no financial support when it comes to long-term care. However, if you know this ahead of time, you can plan for other ways to finance these costs. For veterans, there may be additional benefits you can tap into. This may include using a VA long-term care facility or accessing financial resources to help you hire in-home care or modify your home. Another benefit of planning ahead is that you are more likely to afford long-term care coverage. This kind of insurance is not for everyone, but if you know you are at increased risk for Alzheimer’s and you are planning in your 50s, long-term supplements may be more accessible for you.

Though death can be difficult to think about, you should consider planning ahead for when that time comes. Burial insurance can ease the financial burden of loved ones when it’s time to make funeral arrangements. This type of insurance can cover funeral costs and help pay off debt, such as loans and medical bills. Before you purchase a policy, decide on a budget by thinking about the funeral arrangements and any debts you want to be covered.

Know How Alzheimer’s Care Needs Will Progress

Often, the need for long-term care is sudden for seniors. This can make it a little more difficult to find compassionate, affordable care. If you or a loved one is showing signs of Alzheimer’s and have had a medical diagnosis, you are in a position of being able to plan out your care more efficiently. That’s because Alzheimer’s typically follows a predictable path of progression. The level of care needed will follow this same path. During the beginning stages, Alzheimer’s patients can still take care of themselves, but they may have difficulty controlling emotions, staying organized, and interacting with others. At this point, seniors may just need a little extra help around the house with cleaning and other daily tasks.

As the disease advances, however, those with the condition can become a danger to themselves and will need constant care. This can mean living with a family member or hiring a home health aide to provide more stable supervision and assistance. In the final stages of Alzheimer’s, nursing homes or skilled-care facilities are a necessity, and unfortunately, death is also inevitable. Knowing this information can be heartbreaking, but it does help individuals and family members better prepare for the financial strains of Alzheimer’s.

 Prepare Yourself and Your Family for the Emotional Costs

Bracing your finances for the costs of Alzheimer’s care can save you and your family a lot of headaches as time passes. The real costs of this devastating disease, however, are those that don’t impact your bank account. Knowing what is ahead can be disheartening, but watching the progression of Alzheimer’s in a loved one can be emotionally draining as well.

So, in addition to putting together a financial strategy, be sure to find ways to manage those complicated emotions. For patients, that may mean going to therapy, finding a support group, or looking for a constructive outlet for your pain and anger. It’s common for seniors to experience depression and anxiety after being diagnosed with the disease, but it’s crucial to your well-being that you seek self-care and support. Self-care is also important for caregivers and loved ones so that they can stay strong throughout this painful journey.

 Alzheimer’s can leave individuals and their family members feeling helpless. However, you do have the power to plan for the costs of Alzheimer’s care and prepare for the years ahead. By doing so, you will give everyone peace of mind during a time already filled with pain.

Reference: Rise Up for Caregivers, http://riseupforcaregivers.org/blog/

Holden & Campbell, LLC – Annapolis Estate Planning Attorneys

Special Needs Planning – Annapolis Estate Planning

It is important to understand the basics of special needs planning, so that you can plan for your child’s future. There are many issues to address, but experienced professionals will be able to help.

Special needs planning is challenging. It’s important to have a strong team to work with. An estate planning attorney with experience in helping special needs families will be able to guide you through the process. They will also likely have access to other professionals to help.

A recent Forbes article, “Special Needs Kids Require Specialized Estate Planning,” says that if you have a child with special needs, it’s critical that you look at your planning options with your estate planning attorney and discuss your child’s health, capabilities and prognosis. You can then customize a plan that works for your child, with as much flexibility as possible.

Those with enough assets often would rather not have their child get any government benefits and will set aside an amount to cover all the child’s living expenses in trust. Since the parents aren’t concerned with government benefits, the trust can be a discretionary trust that will distribute income and principal at the trustee’s discretion for the benefit of the child throughout the child’s life.

If there is a good chance the child will receive government benefits, many parents create special needs trust to supplement (not replace) the government benefits that the child will receive. The trust must be drafted so the child doesn’t become ineligible for the government benefits. These benefits provide for the child’s basic needs like a place to live, so the special needs trust will defray the cost of extras such as trips and entertainment.

If the parents can’t determine if their child will be eligible for government benefits, another option is for the parents to give their current trustees the authority to create a separate special needs trust at the time of the surviving parent’s death. Therefore, if the child is receiving benefits, the trustee can create the trust at that time with the goal of preserving the child’s benefits.

All these trusts can be funded now. The parents can establish the trust and transfer cash or other assets to it, or the trust can be created now and left empty until a parent passes away. At that point, money can move into the trust from the parent’s estate, another trust, or from a life insurance policy.

Some parents elect not to create a trust for their child and to disinherit him completely. The thinking is that the child can be supported solely by government benefits. Others go with a combination approach. They disinherit the special needs child and leave more assets to their other children with the understanding that the other children will care for the special needs child. However, this isn’t a great idea. The siblings have no legal obligation to care for his or her sibling with special needs, just a moral one. If the child who inherited the bulk of the estate gets divorced, the assets are also susceptible to division upon divorce. Finally, the assets are liable to a creditor’s claim if the child is sued.

Give yourself the peace of mind that comes from knowing you have done everything possible to ensure that your special needs child will have what he or she needs when you are no longer here to protect them.

Reference: Forbes (March 27, 2019) “Special Needs Kids Require Specialized Estate Planning”

Holden & Campbell, LLC – Annapolis Estate Planning Attorneys

What You Need to Know About Medicare - Annapolis Estate Planning

The first rule of Medicare is that it does not pay for everything. The next rule: you have to do your homework. Don’t be swayed by strong sales pitches.

Switching to Medicare from a traditional employer’s health insurance plan can be a little unnerving at first. There are things that Medicare does cover. However, there are also things that it doesn’t. Let’s start with Original Medicare or Traditional Medicare. These are known as Medicare Part A and Part B. They cover a good amount of medical expenses, once people turn age 65. Part A is all about hospital insurance when you are an inpatient, part of your stay in a skilled nursing facility, surgery, hospice care and some (but not all) health care provided at home.

Part B is your medical insurance that helps pay for doctors' visits, outpatient care, some preventive services and some medical equipment and supplies. Most seniors can enroll in Medicare three months before the month they turn 65.

Kiplinger’s article, “7 Things Medicare Doesn't Cover,” takes a closer look at what isn't covered by Medicare, plus information about supplemental insurance policies and strategies that can help cover the additional costs, so you don't wind up with unanticipated medical bills in retirement.

Prescription Drugs. Medicare doesn’t provide coverage for outpatient prescription drugs. However, you can purchase a separate Part D prescription-drug policy for that or a Medicare Advantage plan that covers both medical and drug costs. You can sign up for Part D or Medicare Advantage coverage when you enroll in Medicare or when you lose other drug coverage. You can switch policies during open enrollment each fall.

Long-Term Care. Medicare provides coverage for some skilled nursing services but not for custodial care. That includes things like help with bathing, dressing and other activities of daily living. However, you can purchase LTC insurance or a combination long-term-care and life insurance policy to cover these costs.

Deductibles and Co-Pays. Part A covers hospital stays and Part B covers doctors’ services and outpatient care. Nonetheless, you have to pay out-of-pocket for deductibles and co-payments. Note that over your lifetime, Medicare will only help pay for a total of 60 days beyond the 90-day limit (“lifetime reserve days”). After that, you’ll pay the full hospital cost. Part B typically covers 80% of doctors’ services, lab tests and x-rays. However, you must pay 20% of the costs after a $183 deductible (in 2018). A Medigap (Medicare supplement) policy or Medicare Advantage plan can fill in the gaps, if you don’t have the supplemental coverage from a retiree health insurance policy. If you purchase a Medigap policy within six months of signing up for Medicare Part B, insurers can’t reject you or charge more because of preexisting conditions. Medicare Advantage plans have medical and drug coverage through a private insurer. They may also provide additional coverage, like vision and dental care. You can switch Medicare Advantage plans annually in open enrollment.

Most Dental Care. Medicare will not provide coverage for routine dental visits, teeth cleanings, fillings, dentures or most tooth extractions. There are Medicare Advantage plans that cover basic cleanings and x-rays, but they usually have an annual coverage cap of about $1,500. You could also get coverage from a separate dental insurance policy or a dental discount plan.

Routine Vision Care.  Medicare doesn’t cover routine eye exams or glasses (exceptions include an annual eye exam if you have diabetes or eyeglasses after certain kinds of cataract surgery). However, some Medicare Advantage plans give you vision coverage, or you may be able to purchase a separate supplemental policy that provides vision care alone or includes both dental and vision care. If you saved money in a health savings account before you enroll in Medicare, you can use the money tax-free at any point for glasses, contact lenses, prescription sunglasses and other vision care out-of-pocket expenses.

Hearing Aids. Medicare doesn’t cover routine hearing exams or hearing aids, but some Medicare Advantage plans cover hearing aids and fitting exams, and some discount programs provide lower-cost hearing aids.

Overseas Medical Care. With a few exceptions, Medicare does not pay for care you receive when outside of the country. The exceptions are few and far between, like if you were on a cruise ship, and then only if you are within six hours of a U.S. port. There are Medigap plans that will cover 80% of the cost of emergency care abroad with a lifetime limit of $50,000. Those are parts C-G, M and N. It is also possible to purchase select Medicare advantage plans to cover emergency care while overseas. You can also buy a travel insurance policy to cover some medical expenses, while outside of the United States. However, shop wisely for these policies, since there can be strict limits on what they actually pay.

Reference: Kiplinger (May 23, 2019) “7 Things Medicare Doesn't Cover”

Holden & Campbell, LLC – Annapolis Estate Planning

Talking About Future Care Needs with Parents - Annapolis Estate Planning

It’s great to take a trip home and catch up with family, especially when you live far away.  However, if this is the year that you arrive to find big changes in your aging parents, here’s some help about what your next steps might be.

When nostalgia doesn’t quite match up with reality, it’s time for some challenging conversations with aging parents and, if you have them, your siblings. It’s not an easy topic, according to the article, “Making the best care decisions for aging parents,” from KARE 11 in Minneapolis, but it is better to have the conversation and make the plans for what’s next than it is to bury your head in the sand and pretend that nothing’s wrong.

Many families find this out the hard way. When a parent requires immediate urgent care, the family must jump into “go” mode. It can be overwhelming. There are many options, which range from various levels of in-home care, to independent living, to assisted living and even to skilled nursing care. You should understand the level of care you need and what you can afford.

Unless you qualify for Medicaid, you’ll need to pay for assisted living out of your own pocket. For most of us, this could drain assets in short order. Many people also aren’t planning for long-term care in retirement.

It’s best to plan early. If you're going to buy a long-term care policy, the best time to apply is in your 40s or 50s, when your health is good and the cost is cheaper.

Sit down with an elder law attorney, regardless of your assets, because the laws concerning Medicare and Medicaid are confusing. Every situation is different.

Many people aren’t aware that Medicare doesn’t cover many long-term care services. In fact, that limited benefit is designed to get somebody back to independent living, not help them with basic activities of daily living. Therefore, if it becomes a situation where somebody is going to need help with such basics as dressing, bathing and other activities of daily life for the rest of their life, Medicare is not going to cover it.

If you believe gifting your estate away now will stop you from losing it in the future, remember that most states have a five-year look back period. Any gifts of money or property in the 60 months before applying for Medicaid can be taken back to pay for the program or the applicant will be penalized.

There’s very little about this that is easy for aging parents or adult children. However, planning in advance, in an intelligent and sensitive manner, is better than having to make hard choices in an emergency.

Reference: KARE 11 (Minneapolis) (November 27, 2018) “Making the best care decisions for aging parents”

Holden & Campbell, LLC – Annapolis Estate Planning

Get Ready for Medicare Premium Increases in 2019 – Annapolis Estate Planning

If you’re among those with the highest income, you’ll see a new surcharge tier in 2019.

According to an announcement from The Centers for Medicare & Medicaid Services, most seniors will pay $135.50 per month for Medicare Part B in 2019. In 2018, that was $134.

Kiplinger’s recent article, “What You'll Pay for Medicare Premiums in 2019,” reports that a few Medicare beneficiaries (about 3.5%) will pay somewhat less because the cost-of-living increase in their Social Security benefits isn’t big enough to cover the full premium increase. The “hold-harmless provision” keeps enrollees’ annual increases in Medicare premiums from rising above their cost-of-living increases in Social Security benefits, if their premiums are automatically deducted from their Social Security payments. Social Security benefits are increasing by 2.8% in 2019, which will cover the increase in premiums for most seniors.

Premium increases are also pretty slight for most higher-income beneficiaries. Who are they? Those with adjusted gross income plus tax-exempt interest income of more than $85,000 if single or $170,000 if married filing jointly. These people already pay a high-income surcharge. However, a new surcharge tier will apply in 2019 for people with the highest incomes. Thus, monthly premiums for higher-income beneficiaries will be between $189.60 to $460.50 per person, based on their income.

If your income is $85,001 to $107,000 (or $170,001 to $214,000 if filing jointly), your monthly premium will go from $187.50 to $189.60. Monthly premiums for singles with an income of $107,001 to $133,500 (joint filers with income of $214,001 to $267,000) will be $270.90 (that’s up from $267.90). Premiums for singles earning $133,501 to $160,000 ($267,001 to $320,000 for joint filers) will increase from $348.30 to $352.20.

If your income was greater than that, your monthly premium for 2018 was $428.60. In 2019, again, there’ll be an extra surcharge tier for people with the highest income. These high-income surcharges for 2019 are typically based on 2017 income. You can contest the surcharge, if you’ve had life-changing events that may have dropped your income since then. This includes retirement, divorce, or the death of a spouse.

If your income is in the range of $160,001 to $499,999 ($320,001 to $749,999 for joint filers), you’ll pay $433.40 per month. Single filers with income of $500,000 or more ($750,000 or more for joint filers) will pay $460.50 per month.

That’s not all that’s going up in 2019. The deductible for Medicare Part A, which covers hospital services, will increase from $1,340 in 2018 to $1,364 in 2019, and the deductible for Medicare Part B will see a small increase from $183 to $185. That’s the part that covers physician services and other outpatient services.

Reference: Kiplinger (October 12, 2018) “What You'll Pay for Medicare Premiums in 2019”

Holden & Campbell, LLC – Annapolis Estate Planning

Medicare Facts and Penalties You Need to Know – Annapolis Estate Planning

Start with the basics, to make sure you’re making informed decisions.

Created in July 1965 as part of the Social Security Act, Medicare is how most adults over age 65 cover their healthcare costs. Medicare has four parts. They are Part A: Hospital, Part B: Outpatient Services, Part C: Medicare Replacement and Part D: Prescription Drugs. This useful article from Think Advisor, “Essential Medicare Facts & Penalties Advisors Should Know on One Page,” covers Medicare fundamentals.

As a general rule, if you are 65 and you or your spouse have paid Medicare taxes for at least 10 years, you may enroll in the program. Those under 65 may also enroll, if they are disabled or have end stage renal disease.

Let’s look at the different parts of Medicare:

Part A is free for most people. If you didn’t pay Medicare taxes, you may be able to enroll and pay for Part A. If you’re under 65 and didn’t pay into Medicare, you may be eligible if you have been entitled to Social Security or Railroad Retirement Board disability benefits for 24 months or you are a kidney dialysis or kidney transplant patient.

Everyone is required to pay a premium for Medicare Part B, which is deducted from your Social Security retirement payment. If you’re eligible but haven’t yet begun to receive a Social Security retirement benefit, Medicare will send you a bill.

Part C is also known as a Medicare Advantage plan. It’s issued by a Medicare-approved private insurer. Even if you choose Medicare Part C, you still are required to pay a Part B premium. Although these plans cover all services in Part A and Part B, they frequently have other benefits like vision, dental, hearing, and prescription drugs.

Part D covers prescription drugs. Each Medicare drug plan list its approved drugs and a “tier” for them. A lower tier drug will generally cost less, and a higher tier drug will cost more.

The window to enroll in Medicare starts on the first day of the third month prior to your birth month and ends on the last day of the third month following the month of your birth.

There is a separate “late enrollment” penalty, if you go 64 continuous days or more beyond the end of your initial enrollment period and did not have a Medicare Prescription Drug Plan, a Medicare Advantage Plan (Part C) and another Medicare plan that offers prescription drug coverage, including a plan through an employer or union.

Make sure to review your coverage and plan in advance to avoid any penalties. If you make a mistake, you may end up paying a premium for certain types of coverage, for as long as you have Medicare.

Reference: Think Advisor (July 31, 2018) “Essential Medicare Facts & Penalties Advisors Should Know on One Page”

Holden & Campbell, LLC – Annapolis Estate Planning

What Does Medicare Cover? And What Doesn’t It Cover? - Annapolis Estate Planning

If you’re counting on Medicare to cover all of your medical expenses after age 65, consider this your wake-up call. Understanding what Medicare does not pay for, will help you decide what coverage you need to buy.

Most people sign up for Medicare three months before the month they turn 65. That’s when you’ll want to have a clear understanding of what you can expect from Medicare:

Part A: Hospital insurance that helps pay for inpatient hospital stays, stays in skilled nursing facilities, surgery, hospice care and certain home health care services.

Part B: Medical Insurance that helps to pay for doctor’s visits, outpatient care, some preventive services, and some medical equipment and supplies.

Kiplinger’s recent article, “7 Things Medicare Doesn't Cover,” gives us a closer look at what is not covered by Medicare, as well as some information on supplemental insurance policies and strategies that can help cover the extra costs. That way, you won't wind up with unanticipated medical expenses in retirement.

Prescription Drugs. Medicare doesn’t provide coverage for outpatient prescription drugs. However, you can purchase a Part D prescription-drug policy or a Medicare Advantage plan that covers both medical and drug costs. You can get Part D or Medicare Advantage coverage, when you enroll in Medicare or when you lose other drug coverage, and you can change policies during open enrollment season each fall.

Long-Term Care. One of the biggest potential expenses in retirement is the cost of long-term care. Medicare provides coverage for some skilled nursing services, but not for custodial care. That’s help with bathing, dressing, and other daily living activities. However, you can buy long-term-care insurance or a combination long-term-care and life insurance policy to cover these costs. The earlier in life you make this purchase, the better.

Deductibles and Co-Pays. You’re responsible for deductibles and co-payments on Medicare Part A hospital stays and Part B doctors’ services and outpatient care. This year, you’ll have to pay a Part A deductible of $1,340 before coverage starts, and you’ll also have to pay a portion of the cost of long hospital stays, which is $335 per day for days 61-90 in the hospital, and $670 per day after that. Note that over your lifetime, Medicare will only help pay for a total of 60 days beyond the 90-day limit—known as “lifetime reserve days”—and after that, you’ll pay the entire hospital cost.

Part B typically covers 80% of doctors’ services, lab tests, and x-rays, but you’ll have to pay 20% of the costs after a $183 deductible in 2018. A Medigap (Medicare supplement) policy or Medicare Advantage plan can close the gaps, if you don’t have the supplemental coverage from a retiree health insurance policy. If you buy a Medigap policy within six months of signing up for Medicare Part B, then insurers can’t reject you or charge more because of preexisting conditions.

The Majority of Dental Care. Medicare doesn’t provide coverage for routine dental visits, teeth cleanings, fillings, dentures or most tooth extractions. Some Medicare Advantage plans cover basic cleanings and x-rays, but they usually have an annual coverage cap of about $1,500. You could also get coverage from a separate dental insurance policy or a dental discount plan.

Basic Vision Care. Medicare also generally doesn’t cover routine eye exams or glasses (except for an annual eye exam, if you have diabetes or eyeglasses after having certain kinds of cataract surgery). However, some Medicare Advantage plans provide vision coverage, or you may be able to buy a separate supplemental policy that provides vision care alone or includes both dental and vision care.

Hearing Aids. Medicare doesn’t cover routine hearing exams or hearing aids, but some Medicare Advantage plans cover hearing aids and fitting exams. Some discount programs also provide lower-cost hearing aids. If you save money in an HSA before you enroll in Medicare, you can also use that tax-free for hearing aids and other out-of-pocket expenses.

Medical Care Overseas. With the exception of very limited circumstances, Medicare does not cover care received, when travelling outside of the U.S. There is coverage available through Medigap plans C through G, M and N, which will cover 80% of the cost of emergency care abroad, with a lifetime limit of $50,000. There are some Medicare Advantage plans that cover emergency care abroad. If you want medical coverage when outside of the U.S., including emergency medical evacuation, it’s advised that you purchase a travel insurance policy.

Reference: Kiplinger (May 23, 2018) “7 Things Medicare Doesn't Cover”

Holden & Campbell, LLC – Annapolis Estate Planning

Tips for Planning and Paying for Long-Term Care - Annapolis Estate Planning

 As we age, our medical costs often increase. There’s a good chance you’ll have to eventually pay for long-term care for yourself or a loved one, increasing out-of-pocket costs even more. While Medicare is available to individuals over the age of 65, it still doesn't cover every single cost or expense associated with medical care. That leaves many adults scrambling to pay for unexpected costs. In a country where many people, including those with health insurance, are still unable to afford all of their skyrocketing medical bills, what are the options?

 Many Americans tap into their retirement savings, which is generally not recommended by most financial advisors because it could hurt you more in the long run. Some wise people have saved up a nest egg to cover unexpected expenses or health emergencies; however, one in four Americans don’t have enough money saved up to cover a medical emergency.

 Luckily, there are other options out there, including supplemental plans that can help cover the costs of additional medical care for yourself or a loved one. Read on to learn how to plan and save for a healthy, happy future.

 Planning Ahead (Modifications, Lifestyle, Etc.)

 Think you’ll never need long-term care? Not so fast. An estimated 10 million Americans require long-term care. According to Medicare.org, “Long-term care is for anyone of any age who needs help taking care of themselves over an extended period of time due to disability, severe mental illness, disease, injuries, or medical events such as strokes or brain tumors.” That means there’s a chance either you or a loved one might require this type of care.

 Since most people inevitably require long-term care at some point in their lives, it’s important to proactively plan for it. First, it helps to understand how to plan for and anticipate long-term care needs. On the planning side of things, you’ll want to start by assessing the likelihood that you or a loved one will require long-term care, whether in the short or long-term. You can do this by thoughtfully answering the following questions:

 What lifestyle choices are you making now?

• How can you reduce the risk of injury or onset of illness?
• Are there any home modifications you need to make?
• Are there hereditary illnesses and conditions that could impact you?

 Saving Up (Accounts, Insurance, Etc.)

 After doing some planning, you’ll be in a good place to start saving up for the anticipated or expected costs associated with long-term care, whether for yourself or a loved one. As you start to budget for these savings, ask yourself the following questions:

 How close are you (or your loved one) to retirement?

• What savings funds and programs are currently available that could help you pay for long-term care?
• What insurance programs are available now to help pay for long-term care?
• How do you plan on paying for the costs of long-term care?
• Are other members of the family, such as spouses, siblings, or children, able and willing to contribute to the costs of long-term care?

 After doing some research on options that are currently available to help with long-term care and unexpected medical costs, you might look into supplemental health care plans. For instance, you might look into a Medicare Advantage plan or Medicare Supplement insurance policy to help cover the costs of additional and out-of-pocket medical care for yourself or a loved one, including copays and deductibles. These plans also allow you to try them out and, if you’ve had your plan for less than a year and are unhappy with it, you can switch to the other option.

 As US News reports, there’s a good chance that someone in your family will need a nursing home sooner or later. There’s even a chance that you might be that someone. However, even if long-term care is in your future, it doesn’t have to be a grim outlook. By taking the steps now to ask some difficult questions, make some lifestyle adjustments, plan ahead, and save up, you can save yourself a lot of hassle and headache. Saving and planning for nursing homes, health care expenses, and long-term care can be difficult, but it can also be done. It just starts with a willingness to take those first steps.

Reference: This post is by guest writer June Duncan, caregiver and author of the upcoming book, The Complete Guide to Caregiving: A Daily Companion for New Senior Caregivers. Books can be purchased at her website, http://riseupforcaregivers.org/.

For more information on medical debt, also see: https://www.thesimpledollar.com/guide-to-combating-medical-debt/.

Holden & Campbell, LLC – Annapolis Estate Planning

Feeling Squeezed? You Might be in the “Sandwich” Generation – Annapolis Estate Planning

 

If you’re feeling pressure on two generational sides—caring for aging parents and taking care of children—you’re a member of the Sandwich Generation.

The term “sandwich generation” was added to Meriam Webster’s dictionary in 2006. However, twelve years later, the number of people it describes seems to be on the rise. Sandwich Generation members are raising their children and are responsible for their parents or taking responsibility for their grandchildren and grandparents. Whichever sandwich you’re in, it’s not an easy place to be. Even if your parents or grandparents are financially fine, your time for yourself, your career and your kids is squeezed.

The Press-Enterprise’s article, “3 tips for anyone in the sandwich generation,” offers the following tips to make the “sandwiching” easier on you and your family:

1. Talk About Money Issues. Discuss finances with your children and parents. Perhaps you could go with them to meet with their estate planning attorney. He or she can make sure your parents have all the proper estate planning documents, such as a will, trust, living wills and powers of attorney.

This legal professional will create a plan to lessen or avoid estate taxes and work to ensure that your life's savings and assets are protected from your beneficiaries' creditors after your death, and that your legacy is assured.

Estate planning attorneys are accustomed to working with families and navigating the issues between adult children and their aging parents. There is little chance that yours is a unique situation. It does not mean it is easy, but a skilled attorney will be able to help you and your family deal with whatever situation you face, with dignity and compassion.

2. Get (More) Help. You may get support or assistance to help your parents, your kids, or even yourself. Odds are good that your parents will be reluctant to accept help, so start the process yourself. This could involve hiring a housekeeper for yourself to free up some of your time for things that are more important.

This will give you more time, and your parents won’t feel you are using your finances to assist them. If you have friends and relatives that offer help, take them up on it. Don’t try to do everything yourself.

If your children are old enough, you can also get them involved. Children are surprisingly capable, and sometimes grandparents are more comfortable having grandchildren help with minor chores around the house, where their children’s own actions may seem intrusive.

3. Get Rid of the Guilt. Even a dedicated husband and wife team can’t cover everything. Do the best you can and remember that you do have to set some time and energy aside for yourself.

Reference: (Riverside CA) Press-Enterprise (June 28, 2018) “3 tips for anyone in the sandwich generation”

Holden & Campbell, LLC – Annapolis Estate Planning

Blueprint for Senior Singles – Annapolis Estate Planning

Singles need to be more proactive about planning for long-term care and estate planning to protect themselves against some of the inevitable issues of aging.

Not having a built-in support system of a spouse, children, in-laws, etc., can lead to challenges for singles as they age. About 35.4 million Americans lived alone in 2016, making up almost a third of all households, according to the U.S. Census Bureau, and about 20 million of them are 65 or older. For these aging singles, planning is key to being prepared for financial security and health issues, as reported by CNBC in “For aging singles, here's how to plan for your golden years,”

Saving as much as possible in a 401(k) plan or IRA while you can is important. You should also make certain that you have emergency savings, if you're still working. If you’re still employed, find out if your company offers group insurance for long-term disability. Those policies provide a portion of your income, in case you end up unable to work due to an accident or other medical condition.

There are other ways for singles to protect themselves, as they age.

In addition to an estate plan with a will, select someone to handle your finances, if you reach a point where you can’t. When you give someone durable power of attorney for your finances, he or she will be responsible for paying your bills with your money. It is, therefore, important to choose someone you trust. You should also grant someone durable power of attorney for health care. That lets the individual make important health-care decisions, if you can’t. That is different from a living will. That document states your wishes, if you’re on life support or suffer from a terminal condition. This helps instruct your proxy’s decision-making. If you have no one named, your healthcare providers must follow your wishes in that document.

If you’re single and don’t have family close by who can assist, if you need help with daily living activities, you'll need to plan for how to pay for it. A person turning age 65 today has nearly a 70% chance of needing such long-term care in their remaining years, according to the Department of Health and Human Services. On average, women need care longer (3.7 years) than men (2.2 years).

You also need to understand that Medicare (which you generally sign up for when you’re 65) doesn’t pay for long-term care. It can be expensive. If you have no family to rely on, and you don’t want to spend down your assets, but you’re above the income threshold to qualify for Medicaid, long-term care insurance can be an option. LTC insurance will pay a daily amount, up to a predetermined dollar limit and length of time, for services. Policies can be expensive, costing up to $2,000 a year for younger applicants (in their 50s) and double that for those over age 65. As with all age and health related insurance, the younger you are when you look into it, the better.

Here's a critical point: if you have a medical emergency and you live alone, you could be at risk. There are many different ways to solve this problem, among them, a medical alert system or a tag team of peers who check on each other daily.

Reference: CNBC (July 2, 2018) “For aging singles, here's how to plan for your golden years”

Holden & Campbell, LLC – Annapolis Estate Planning