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A Minneapolis Estate Planning Lawyer Dispels 13 Myths About Planning for Your Twilight Years
Misconception #1: Most seniors move into nursing homes as a result of minor physical ailments that make it hard for them to get around. Wrong! A large number of admissions to nursing homes are actually due to serious health, behavior, and safety issues caused by Alzheimer’s disease and dementia.
Misconception #2: Nursing home costs in Minnesota average $1,500 to $2,500 per month per person. Hardly. Current nursing home charges for one resident typically run $6,000+ per month, or $72,000 per year, which does not include prescription drugs — and those costs continue to rise.
Misconception #3: Children can care for a parent with Alzheimer’s disease at home, without the need for nursing home care. Not true! Many patients with Alzheimer’s disease end up in nursing homes because children are simply unable to provide the level of care their parent needs. In most cases, the children want to care for their parents. But, as a practical matter, they simply can’t. Moving a parent into a nursing home is an intensely personal issue and should not be labeled as a right or wrong decision. In many cases, it’s the only realistic option. The rare exception is when the family has enough money to pay for skilled nursing care at home.
Misconception #4: Standard legal forms are all you need for a good estate plan. False. A competent estate plan begins with clearly defined goals, supported by well-drafted legal documents, and the repositioning of assets, as needed, to protect your estate from taxes, probate costs, and catastrophic nursing home costs. Further, an estate plan is much more than a set of documents. It’s also the valuable advice from a qualified Minnesota Estate Planning Attorney.
Misconception #5: Your child will never move you into a nursing home. Wrong. Most children consider all options before moving a parent into a nursing home. But, sadly, children may find they have no other alternative. As a result, parents who never expected to live in a nursing home soon discover that a nursing home is the only place with the staff and equipment to provide the care they need.
Misconception #6: As payment for nursing home care, the government will take your family home. Not necessarily. With proper planning, you may be able to save the home. Many people fear that the government will take their home in exchange for nursing home care, but you can avoid this with proper planning. You’ll be glad to know there are some ways you can protect your home so it won’t be taken.
Misconception #7: If your spouse enters a nursing home, all of your joint savings will have to be spent on his or her care. No. With proper planning you can keep half of your combined “countable” assets up to approximately $120,000. “Countable” assets are those assets such as cash, checking accounts, savings, CDs, stocks, and bonds that the government considers available to be spent on the cost of nursing home care.
Misconception #8: Legally, you can give away only $14,000 to each of your children each year. Not true. You can give away any amount, but you have to report to the IRS gifts in excess of $14,000 per recipient per year ($28,000 if both husband and wife make a gift). However, there is no requirement that you pay any gift tax unless you have exhausted your lifet