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Dallas Estate Planning Law Blog

Long-term care insurance makes sense for elderly planning

Long-term care insurance (LTCI) is usually a good idea for someone 55 to 70 who wants to avoid the potential financial hardship that can occur if a nursing home or home-care becomes necessary. The U.S. Dept. of Health and Human Services estimates nearly 70 percent of people who reach age 65 will need long-term care at some point. That statistic of course applies across the board, including in Texas. Unfortunately, less than one-third of people over age 50 have begun to plan for their potential long-term care needs.

An LTCI policy will pay a daily amount to the provider based on the coverage purchased. The premium is based on age, extent of coverage, health and similar factors. Although seniors have often been reluctant to be bound to a premium for years on end, it may be possible to limit that period to five years.

Living trusts can be combined with a will in the estate plan

There's generally no good reason in Texas or elsewhere why you can't have both a traditional testamentary will and a living trust at the same time. Both of these legal instruments specify what should be done with certain assets upon the owner's death. Living trusts are similar to wills in that respect but the assets are conveyed to the control of the trust during life. In the case of the will, the assets are not transferred until after death and probate of the will.

The living trust does provide some distinct advantages that are worth considering, according to one certified public accountant who is also the president of the National Association of Estate Planners and Councils. For example, the estate at death can be administered more quickly because the living trust assets do not go through probate. This allows for probate assets to be eliminated or minimized. The decedent's estate may be opened and closed in rapid order with no waiting, supervision by the court, or ruminating about what is the status of the estate.

Term insurance is a useful tool that can avoid probate expenses

In Texas and all other states, term life insurance can serve a number of uses for estate-planning purposes. Life insurance generally does not go through probate but passes directly to the named beneficiary. In the event that there is no named beneficiary, the proceeds will go to the estate by default and the funds will be subject to probate. In that instance, the life insurance proceeds will be counted as part of the gross estate of the decedent.

The more common situation, however, pertains to the term insurance that has a beneficiary named in the policy. Term insurance generally expires at the expiration of the term. The policy may be effective until the person reaches age 85. If he lives beyond that age, the term has expired and the life insurance expires, causing a forfeit of all premiums paid. Due to these risk features, term life insurance can be significantly more affordable than whole life or other products.

Timely elderly planning helps both the parent and the caregiver

In Texas and elsewhere, being a caregiver for an elderly loved one can be a multi-faceted, daunting task. In addition to the emotional and physical demands of spending many hours each week assisting the parent with a variety of tasks, there are substantial economic demands that can take a toll. That's why elderly planning is an important function that can establish a successful framework for satisfying the many different needs of both the elderly loved one and the family caregiver.

It's very difficult to try and keep up with the many personal needs of an elderly parent, and it is often found that the task should at least be shared with professional caregivers. This is especially true where family caregivers also have full-time or part-time jobs. In addition, legal planning must occur to set up a group of necessary legal instruments.

The need for a living will was shown in Joan Rivers' death

Due to medical advances and active lifestyles, many Texas residents look forward to living to a ripe old age.  Even so, unexpected events can occur that can change everything. Without a living will, family members may never know what their loved one would have wanted when it comes to making end-of-life decisions.  With the recent death of Joan Rivers, many people may be rethinking their estate plans.

Rivers was 81 years old and seemed to be in good health and full of life.  However, during what should have been a minor procedure, she had a massive coronary event that resulted in her being placed on life support.  Reportedly, Rivers did not want her life prolonged by machines.  Therefore, Rivers' daughter took her off life support in accordance with her mother's wishes. 

Estate planning usually means much more than just a will

In Texas and anywhere else, elderly family members sometimes die without leaving all of the pertinent information to guide their heirs in processing matters as they would have wished. There are matters, such as papers relating to the right to a military burial, that may be never passed on to assure that such a burial occurs. One woman's right to have her remains cremated and scattered at sea was never confirmed prior to death. Special circumstances like these must be incorporated into estate planning documentation and discussed with family members during the loved one's life.

Perhaps the most important document at the center of the estate planning process is the will. According to one elder law attorney associated with AARP, a will can sometimes be the main document in an estate planning inventory, and living trusts may not be necessary. She gives that conclusion in opposition to some common wisdom that says it's best to avoid the after-death probate process by administering the assets during life through living trusts.

Add elder law care needs to the estate planning equation

When planning to help out one’s family members, a person may be so generous as to ignore some basic needs of his or her own. However, one should not be so generous in gifting to one’s children and grandchildren that it depletes what the person needs to survive in the future. Thus, the estate planning process in Texas or elsewhere should not ignore the elder law planning needs that must be incorporated into any strong and effective plan.

Although a grandparent naturally wants in particular to help his or her grandchildren to have all the opportunities and benefits of a good life, large or lavish gifting can interfere with basic elder law concerns. The first concern, then, is to set up the basics of long-term care planning for the individual prior to deciding what gifts to give to one’s grandchildren or other family. The huge expenses involved in long-term care in assisted living quarters or in a nursing home should not be ignored.

Estate planning should prepare for long-term care possibilities

One danger not fully appreciated or planned for by seniors in Texas and elsewhere is the financial ravages that can occur if the individual becomes permanently disabled and in need of long-term care and nursing home care. People may think that their Medicare covers long-term care, but it doesn’t. Most people have not prepared by purchasing private long-term care insurance, nor have they engaged in estate planning with an elder law attorney to establish protections for those eventualities.

The U.S. Department of Health predicts that 70 percent of the population over 65 will need some type of long-term care, and more than 40 percent will need nursing home placement. An elder law attorney can explain how Medicaid and other government programs can be used to solve the problem. At the same time, the elder law professional will assist in setting up legal protections for assets and income.

Developing a will helps surviving family members

When it comes to talking about creating a will, many people in Texas may shy away from the subject and prefer to talk about more lighthearted topics. Putting together a will, however, is essential for making sure that one’s earthly possessions are passed on to the right individuals when one dies. It also helps to prevent discord among surviving family members -- discord that can alter family relationships permanently.

Research shows that more than half of people don’t have a will. In addition to directing family and friends on how to distribute one’s personal items in the event of one’s death, it can also provide hope and encouragement. It is also wise to create a health care power of attorney, a document that spells out who can make health care decisions on a person’s behalf if the person can’t communicate on his or her own.

Estate planning is important for both small and large estates

Estate planning in Texas is an essential tool to distribute your estate, no matter how large or small, in the way that you want and to the people that you choose. Complications can arise if one does not put estate planning into place. For example, bickering among relatives may occur after death where there is nothing to guide them as to your intentions.

Lack of planning can also cause added frustration during difficult times. In one’s last illness, for example, without the proper living will and healthcare directive drawn up, your people will not have the authority to assist or direct the physicians regarding medical determinations. With the living will, one can tell the medical providers what to do regarding artificial means of life extension.

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Austin, TX 78734
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Addison, TX 75001
Phone: 972-685-5202
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