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Estate planning is critical if long-term disability approaches

Estate planning can be critical for those facing a gradually increasing medical disability. That was the unfortunate situation for a Texas couple in their early seventies. The husband had been in the early stages of Alzheimer’s disease for several years, which gave them time to make sure that they updated and maximized necessary estate planning protections.

They found an attorney who practices elder law and estate planning. They set up a health care proxy and a durable power of attorney giving the wife, and alternatively their children, the power to take care of the husband’s affairs during any period of disability. It is crucial to do this when the individual is lucid and able to act for himself. That saved them the frustrating and costly prospect of having a guardian appointed.

They updated their wills and all of their holdings, and listed all account numbers and other vital information in a master list that they kept, with copies to the children and their attorney. They moved to a more practical setting that could adjust to impending medical changes. They sold their boat, beach house and home in Houston and moved to an elder-care community in Corpus Christi. The complex has a skilled-nursing care unit and a memory facility for support when and if needed.

Because Alzheimer’s can have a gradual onset, experts recommend that the couple make use of this extra time to spend down their assets if they need to qualify for Medicaid in the future. There is a five year window to do this. But any transfers made within five years of the application may be subject to an offset against the transferred funds.

A state partnership long-term care policy is now available in most states, including Texas. It is designed to make more assets available and protected if Medicaid becomes necessary. Also, it can be beneficial to consult with a geriatric care manager to learn about a myriad of benefits for which individuals may be qualified. These are all part of the overall estate planning process that can be of invaluable benefit to those facing a future medical disability.

Source: Sun Sentinel, "Facing Alzheimer's? Prepare for the financial punch now", Kimberly Lankford, June 23, 2014

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