myths about retirement

3 Myths About Retirement That’ll Cost You Money

Many people plan for retirement, but there are expensive surprises that can crop up around healthcare and derail your plans. Read on for 3 surprises about retirement that can cost you lots of money.

3 Myths About Retirement That Will Cost You Money

1. You’ll retire at 70. 22% of workers say they’ll wait until 70 to retire, but only 9% of retirees actually retired at that age according to a survey by the Employee Benefit Research Institute. Think about your friends and family. At what age did they retire? This is probably a more accurate picture of what the reality will be for you.

2. It’ll be all fun and games. I was recently talking with one of our staff who has a lot of experience in long-term care facilities. She said something very poignant, “Everybody plans and thinks about retirement, but you can’t just plan for retirement. You have to plan for your health.” There will come a time (generally after the age of 75) where the traveling will wind down and your health issues will increase. Will you be ready for that? You can find a great clearing house of information on this topic at the University of Minnesota Extension site, in addition to the information on our own website under Costs of Aging.

3. Medicare covers everything. Many people assume that once they are 65 Medicare will take care of all their health needs. Generally, Medicare will only cover 48% of costs, and Medicare DOES NOT cover long-term nursing care. That leaves a lot of expensive medical care and deductibles to be paid for out of your own pocket. Read more about Medicare and Medicaid here.

Life Care Planning Can Address These Issues

Life Care Planning can help address several of these myths, making you better prepared to deal with the reality of retirement.

So, you’re probably wondering, “What is Life Care Planning?”

Life Care Planning is a fairly new concept in the estate planning field that came about because people are living a lot longer these days. Estate planning attorneys realized that planning didn’t just need to be “death planning” anymore, that there is a lot that can be done within the law to make the last decades of life a little easier and less stressful.

Life Care Planning can help you and/or your loved ones get the best possible care during their last decade of life and find the best way to pay for it. Good, holistic planning also looks ahead to the various stages that your family may go through during the aging process. Each stage has its own unique goals, pitfalls, concerns, and challenges. Some families may skip certain stages; others may move forward and then go back to a prior stage as healthcare improves or declines.

No matter what your journey holds, your planning should start now by determining where you (or your loved ones) are in the planning stages, while also looking to where they might be in the coming months or years.

Here are the 5 stages of Life Care Planning.

Which stage are you or your parents in right now?

Stage #1: Healthy, but let’s look ahead for the maximum benefit.

The situation: More than 5 years until care will be needed. (This is where Life Care Planning can do the most good.)

The person is still living at home, drives, travels, handles finances, volunteers, maybe even works part-time. Hopefully it will be 10-15 years or more until care is needed.

Actions: Update the estate plan, will, and powers of attorney. Review asset titling and beneficiary designations. Consider a “nest egg trust” for future asset protection.  Also, consider a revocable living trust.

Stage #2: Not as young as I used to be.

The situation: May need care or assistance within the next 5 years.

The person continues to drive, shop, and pay bills. But he or she is starting to lean on the family more for help or decisions. Increased health issues may even mean time in the hospital.

Actions: Update the estate plan, will, and powers of attorney. Consider a “nest egg trust” for future asset protection. However, beware of care needs coming more quickly than expected, which will change the legal and financial options.

Stage #3: Needing more and more help.

The situation: Needs help with meals and housework.

The senior’s memory is not what it used to be. You notice increased reliance on the family at home, or the person may be in an independent living facility with their own apartment and meals provided. The person may not drive or drives only during the day or on short trips.

Actions: Plan for looming care needs. May qualify for Veterans benefits now or, if not now, may qualify soon. Important to plan ahead for possible Medicaid benefits later.

Stage #4: Declining, but still at home OR declining but in assisted living.

The situation: Needs medical care at their own home or may be living with family. A lot of times the person has become too much for the family to handle themselves. At this point they may be in and out of the hospital.

The elderly person needs substantial assistance at home or in assisted living. They no longer drive. They need daily assistance that may include dressing, getting up, eating, using the bathroom, bathing. May need help during the day or maybe 24 hours a day. Leans on family for most, or all, legal or financial decisions.

Actions: Plan for looming care needs. Make sure finances are managed well, bills are paid on time, and help them avoid being taking advantage of by others financially. If the person is a veteran, they will probably qualify for Veterans benefits with proper planning. It’s important to plan ahead for possible Medicaid benefits later. Consider a financial plan, whether income will cover monthly expenses, and how long assets will last.

Stage #5: In crisis, either in the hospital or nursing home.

The situation: The person is in the hospital, rehab, or a nursing home. It is expected they will not be able to return home or to an assisted living facility. The next option is a skilled nursing facility.

Actions: Need immediate planning help to maximize Veterans or Medicaid benefits and protect assets. It is rarely “too late” to do anything.

Planning for retirement can be fun if you only think of the ideal situation. But reality may prove otherwise when it comes to unexpected hospitalizations or illnesses. However, by planning for reality and the challenges of retirement, you can make sure that you can still accomplish your goals, whether they be maintaining independence, passing property down to your children or preserving assets for charitable giving. If you’d like to learn more about Life Care Planning, our workshop, Aging With Confidence: 9 Keys to Wise Planning & Peace of Mind, is the perfect way to do that. At this 1.5-hour workshop you’ll discover:

  • planning must include both death planning (estate planning) and LIFE planning
  • the 5 life stages of planning and which stage you’re in
  • 9 easy to understand keys to aging with peace of mind
  • clear next steps to guide your planning and create an aging roadmap
  • simple planning steps to take on your own, plus options for additional guidance from Edwards Group’s experienced team

Call us at 217-726-9200 to RSVP for an upcoming workshop today!

gamble estate plan

Do You Like to Gamble? Advice for Those Who Haven’t Planned Yet

Michelle and I don’t gamble very often. But when we do, watch out!

A few years go, the kids went to the grandparents’ and we spent the weekend in St. Louis. We were staying near Laclede’s Landing at a new hotel near the Lumiere Place Casino. The evening after we checked in, we headed out to do some serious gambling.

We stopped at the penny slots and started playing. About 10 minutes later, we hit a big jackpot! Being up all of $12, we decided to quit while we were ahead.

Do you enjoy gambling? We find that most of our clients don’t like to roll the dice about their planning. Instead, they want to tie it down so they can have real peace of mind.

Not planning ahead to protect your family and your assets is gambling.

What will happen if you die suddenly? What will happen if you need long term care?

Leaving things to chance is a gamble and the losses can be HUGE.

4 Reasons to Plan Ahead

With good planning, you can have real peace of mind and not gamble that these vitally important things will just work out. By planning ahead, you can avoid these 4 hardships:

1. Stress. You wouldn’t purposefully place extra stress on your spouse or your kids, would you? But a lack of planning on your part can do just that, leaving everyone to wonder, “What should we do? Who do we contact?” Good planning makes it easier on your loved ones by providing a clear plan.

2. Delay. Messy estate plans take longer to wrap up, causing the stress and extra work of an estate to drag on and on. Good planning helps things get wrapped up as quickly as possible.

3. Conflict. Lack of planning can lead to arguments in the family. Arguments between siblings, between the step-mom and step-kids, between nieces and nephews. Good planning will make it easier on the family, making less to fight about and less stress that can lead to conflict.

4. Loss of life savings. Lack of planning can result in the loss of your wealth — to the nursing home, to probate expenses, to taxes, to creditors or to wild spending by your heirs. Good planning will protect what you have worked so hard for.

If you’re interested in learning more about effective planning, check out one of our upcoming workshops. They are a free and no pressure way to get started! And, as always, if you have any questions at all or are unsure of what your next step should be, give us a call at 217-726-9200. We would be more than happy to chat with you.

The Difference Between Medicaid and Medicare for Seniors

Medicaid and Medicare are two different programs (but with a similar name). Medicaid may help with nursing home costs, as we discussed in a previous case study. Medicare is health insurance that helps seniors pay for doctors, hospital stays and prescriptions. So, does Medicare help with nursing home costs?

Check out these facts:

  1. The maximum number of days Medicare will help is 100.
  2. After 20 days, Medicare requires you to pay a co-payment.
  3. Medicare only kicks in if you have a hospital stay prior to the nursing home stay.
  4. If you’re not able to make progress in rehab, then Medicare can stop paying prior to 100 days.
  5. After 200 days, or after rehab is done, Medicare will pay nothing toward your long term care. Medicare is still available to pay doctor visits, etc. but will not provide help for ongoing nursing home costs beyond the 100 days.

Read more about how we helped one family with nursing home asset protection HERE, and download the full Nursing Home Case Study.

Want to read more about the 100 day Medicare benefits? Check out this link.

How to Pay for Nursing Home Costs

How do you keep life savings from being depleted by nursing home costs? Read our Nursing Home Crisis Plan Case Study to find out one of the ways we helped a client.

Couple walking no textQuick Summary

Mary recently had a stroke and will have to be placed in a nursing facility. She doesn’t want nursing home care to drain all of her savings.

Edwards Group worked to maximize Medicaid benefits as quickly as possible, created a trust to preserve assets, pre-paid funeral costs and preserved more than 50% of Mary’s assets.

Total Savings to Mary and her family: more than $100,000.

Read the full story here.

5 Reasons You Need a Trust

Trusts are a very valuable planning tool. When people think about estate planning, most people think about wills. While wills are the most basic/common tool for estate planning, trusts are an incredibly effective way to plan for things that wills can’t address. Trusts can be used to:

  1. Organize your assets so it’s easier on your family later. (Read about two types of asset organization mistakes here.)
  2. Set out instructions for when you’re not able to make your own decisions — either upon disability (like a stroke) or death.
  3. Keep things private. (All wills are public record.)
  4. Protect assets from creditors, divorces, kids who don’t know how to manage money and even future lawsuits you can’t anticipate (like car accidents).
  5. Reallocate assets to maximize long-term care benefits such as Medicaid or VA benefits.

If you’re ready to get started protecting what you’ve worked so hard for, call us at 217-726-9200 to schedule an initial appointment with one of our attorneys. If you want to learn more without any obligation, our free 1.5-hour workshop, Aging With Confidence: 9 Keys to Wise Planning & Peace of Mind, is a great way to learn about effective planning for every stage of life while finding out why our approach is so unique and effective. Give us a call at 217-726-9200 to RSVP.

elder fraud

Granny We Need to Talk: Questions that Can Stop Elder Fraud in Its Tracks

In our past two posts we talked about how Elder Fraud is on the rise and the types of fraud to look out for. Here are 7 questions to ask your friends and loved ones that can raise red flags about the possibility that they are being set up as a target for Elder Fraud:

  1. Have you had any recent phone calls or solicitations? (Cold-calling is still a very effective way to take advantage of seniors.)
  2. Has anyone recently asked to obtain your Power of Attorney?
  3. Has anyone with regular access to the home asked for financial information?
  4. Is a financial advisor pushing you to move money or purchase a financial product that you don’t understand or sounds “too good to be true”?
  5. Has anyone asked to borrow money?
  6. Has anyone borrowed things from you and not returned them?
  7. Are you donating to any new charities that you have not previously supported?

Maintaining this sort of dialogue with neighbors, friends and professionals connected with your older relatives could stop fraud in its tracks.

Who do you call for advice on aging?

When your family hits a situation where mom, dad, grandma or grandpa can’t stay at home anymore, where do you get your advice? What if a loved one is struggling with health issues that you don’t really understand?

Many people turn to friends, neighbors or relatives who’ve dealt with it once before. Support from friends is always needed in difficult situations like this, but you may also greatly benefit from professional advice and guidance from those who understand the ins and outs of what you’re dealing with.

Edwards Group deals with the issues of aging every day, and we help guide people through the difficult process. There are many issues to consider – what type of care, which facility, how to pay for it, which legal documents you need, asset transfers, how to protect the healthy spouse still at home, and dealing with complicated benefit applications. Our elder care advisors are equipped and experienced in helping families through just about any issue they face.

There are two types of benefits in particular that can be helpful in paying for care that may be needed as a loved one ages:

1. VETERANS BENEFITS

Wartime veterans or their widows may qualify for benefits from the VA to help pay for care as they age. This benefit may be available to pay for in-home care, assisted living, or a nursing home.

In order to qualify for the maximum benefit, legal planning may be needed. We work with families regularly to help prepare them to qualify for the maximum benefit. A married veteran may qualify for over $2,000 per month in benefits. A widow of a veteran may qualify for over $1,100 per month in benefits.

Please CLICK to review this case study about how we helped one local family.

The VA process can be complicated. Let us help your family understand the potential benefits and what planning may be needed before your application is filed.

2. MEDICAID BENEFITS

When a loved one needs nursing home care, that is one of the most stressful things a family faces. We help families every day deal with this difficult issue.

One of the biggest concerns is often “how do we pay for it?” Nursing homes are expensive, often $5,000 per month or more. For many families, that cost will eat up their savings within a short time. Medicaid benefits are one option that can be used to pay for care and protect some of your wealth. (70% of nursing home residents in the U. S. rely on Medicaid to pay their bill each month.)

If your family is faced with nursing home care and are paying out of pocket, we may be able to help. We have many legal planning tools available to maximize benefits and protect the family’s wealth, while still getting good care for the loved one. Some families are surprised that we may be able to get a loved one to qualify for Medicaid benefits sooner than expected while protecting assets in the process. (While you can apply for Medicaid benefits on your own, we don’t recommend it. Here’s why.)

CLICK HERE FOR CASE STUDY

HOW WE HELP FAMILIES FACING LONG-TERM CARE QUESTIONS

  1. We want to get families all the benefits they are entitled to. More benefits leads to more resources, and that means better care for your parent or loved one.
  2. Most parents want to leave something to their kids and grandkids. Our planning helps make sure that those who matter most to you will be taken care of when you’re gone.
  3. No parent ever dreams of using up all their savings on a nursing home stay, but it happens fast. We have legal tools and resources to help preserve assets and find other ways to fund long-term care.
  4. Parents never want to be a burden to their children. Good planning relieves your children of the stress that comes from scrambling to figure out how to pay for care you might need and the huge amount of paperwork that comes with that crisis.
  5. Planning like this isn’t greedy. It’s wise — kind of like minimizing income taxes every year through the use of an accountant. You’ve worked hard all your life. Why not protect as much as the law allows?

Chances for good planning disappear with time. The sooner you contact us, the more we can do to help. As elder law attorneys, our main goals are to:

  • Help carry out the wishes of the client.
  • Help clients access all available resources.

If you have a loved one facing changes in their living arrangements, please contact us to discuss your options. Our staff is specially trained in Medicaid and VA Benefits, both of which are important when it comes to long-term care planning.

What’s Worse Than Probate?

Today we’re going to talk about “What’s worse than Probate?” But first, let’s talk about what probate it exactly.

What is Probate?

Probate is where the judge has to get involved in carrying out an estate after death. This means nothing can be done until the judge signs the order appointing an executor. Wills are designed to go through probate. That’s just how the law works. Probate ALWAYS adds extra expense and delay. Plus, it’s public record.

What’s worse than Probate?

Uncle Fred was getting older. He finally got to the point where he was not able to stay at home any longer. His favorite nephew in Missouri said, “Come live with me.” So Uncle Fred moved to Missouri and enjoyed several years there before passing away. After he was gone, the family realized that he still owned his house in Illinois, so they had to go to probate court in Illinois. Plus, he had moved his bank and investment accounts to Missouri when he went to live with his nephew. So now they were faced with probate court in Missouri, too!

So… what’s worse than Probate? Two probates!!

Anyone with assets in more than one state needs to plan carefully to make their plan work smoothly in each and every state. Watch out for timeshares, vacation homes and ownership in family real estate. If overlooked, all of these could add time, expense and hassle in the form of extra probate for you or your loved ones.

Good planning, especially with a Living Trust, works well across state lines.

You can read more about living trusts on our website by searching “living trusts.” Call us at 217-726-9200 with questions. In the meantime, be sure to sign up for our weekly e-newsletter with estate planning tips and up to date workshop information, or plan to attend an upcoming workshop.

Pre-nups, Not Just for Divorces Anymore

What does a pre-nup have to do with estate planning? Let me tell you. A pre-nuptial, or pre-marital agreement, outlines how a married couple will handle their assets. It covers more than what happens in a divorce. If we assume the couple will be happily married forever, here are still at least 2 situations that may need planning ahead:

  1. Who will pay the household expenses during the marriage?
  2. How will the assets be divided at death?

As an estate planning attorney, I am working on more and more pre-nups. Here is an example of a situation:

A couple, both in their 50’s, are planning to get married. One is a widow, the other is divorced. Both have accumulated some assets and are having success in their careers. Each of them has a couple of kids. How important is it that their assets end up with their kids, rather than the step-kids? Without planning ahead, it will be very easy for the assets to go to the wrong people. How? Suppose they buy a house or hold bank accounts in joint ownership. The family of whoever dies first will lose those assets, unless the survivor voluntarily shares it with the kids. (Read more about Asset Protection HERE.)

They can protect their wealth and their kids by signing a pre-nup, having an up-to-date trust or will, and paying close attention to asset titling (what we call the “funding” of an estate plan). Then they can have peace of mind while living “happily ever after.”

Who do you know that’s engaged? Particularly if it’s the second time down the aisle, it really is best for everyone to consider a pre-marital agreement. Plan ahead now, and avoid the stress and heartache for the family later.

$14 Million Gone In Just 12 Years! What will your kids do with their inheritance?

Check out this stunning article about blown inheritances:

Family’s Fall from Affluence is Swift and Hard

You might expect a story about blown inheritances to exclusively belong to the twenty-something crowd, but in a recent article from The New York Times we see that it can happen to anyone, no matter their age. Quick money can disappear just as quickly as it appears!

Are your loved ones ready to inherit from you? What would they do with the money? Would they have any left after just a few years? What if there was a way to help them handle your hard-earned money after you’re gone?

An effective estate plan does more than just transfer the money. A good estate plan also sets your family up for success and helps them be prepared for whatever may come their way.

Take a quiz here on our website to see if your family is ready. And even if you think they’re ready, you may want to reconsider after reading this article again!