What is Asset Protection?
Many families originally come to see one of our elder law attorneys because a loved one is becoming at risk for a long-term care crisis. The individual, his/her spouse or other family member can see their loved one becoming more fragile, experiencing falls in the home or receiving a diagnosis of a chronic condition that requires daily assistance.
Any need for long-term care creates a fear of the unknown. How is this going to affect my parent’s ability to stay at home? How much is this going to cost? Will we outlive our money? And other similar questions. The earlier a family visits an elder law attorney, the more options their loved one is likely to have with care and payment of care.
Asset Protection is a common strategy employed by our elder law attorneys as a method to preserve a portion, if not all, of the assets an individual or couple may have. This strategy, at minimum, may help to “stretch” the funds an individual or couple has to pay for care. In addition, it can facilitate the transfer of assets in order to allow the impacted individual access to public benefits.
First Things First
Upon first meeting with the individual, couple or family, a review of the important legal documents is conducted. The two most important documents a lawyer can draft as part of estate or asset protection planning are the Durable Power of Attorney(POA) for Healthcare and the Financial Durable Power of Attorney(POA). Without the POA for Healthcare, a family member cannot make decisions about a loved one’s care, even if that loved one is no longer able to make decisions for him or herself. Without a POA for Financial Matters, a family member may not be able to access funds to pay for care or employ asset protection strategies on behalf of the loved one. POAs that are three or more years old should be reviewed to make sure they are still accurate and include all the authority now permitted by Missouri law.
Asset Protection Strategies
Having a will and making use of Payment on Death (POD) and Transfer on Death (TOD) designations are basic strategies to protect someone’s assets. Without those basic measures, upon death, the estate will need to be probated. That will cost the family time and money. A trust may be a better option for someone who wants to make sure the assets will be used just as he or she dictates.
Asset Protection Strategies can include transferring assets into an irrevocable trust so that the individual at risk for skilled care can access public funds when needed to pay for care. Medicaid planning is a common strategy for those concerned about needing skilled care and outliving their money.
Upon scheduling a free consultation with one of our attorneys, the individual, couple or family member will complete a questionnaire, fully disclosing their legal and financial information. The attorney will use that information to assist the family in deciding what asset protection strategies would best meet their goals. The more time that is available prior to care being needed, the better the strategies will work.