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Do I need to protect my assets with long-term care insurance?

On Behalf of | Sep 18, 2020 | Estate Administration |

You worked hard all your life. You scrimped and saved and were looking forward to helping your children after you were gone. You worked with an estate planner and got your affairs in order. But is there one crucial piece of the puzzle you are missing?

When the unforeseen happens

Many of us understand that as we age, we encounter some health issues. What happens when the health issues are not minor, but major? What happens when our savings that we have worked so hard to retain, threaten to bankrupt our estate? Is there a way to plan for this uncertainty?

Unfortunately, when the unforeseen happens, the government expects us to exhaust our savings before Medicaid offers help. This means no money left for heirs. But long-term care insurance is an option for off-setting those costs.

Medicaid Lookback period

Medicaid has a 5-year lookback period. What does this mean for you? Any assets you have transferred, sold or given away and can be clawed back by Medicaid for the last five years. Did you give a car to one of your kids? Medicaid will expect to get the full value of the car. Did you gift money to a sibling? Again, Medicaid will expect reimbursement.

Long-term care pays during lookback period

The average long-term care policy covers care for the total lookback period. This allows you to plan for asset distribution without worry that Medicaid will claw-back the assets.

We work hard and we reserve the right to pass on what our earnings and assets to our heirs. With long-term care insurance added as part of your comprehensive estate plan, you can plan on doing just that!

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