When you plan your estate, you make decisions about the inheritances that you will be leaving to your loved ones. At the same time, you have some control over the size of the pie that will be sliced up after your passing.
There are some looming threats that can impact your legacy, and we will take a look at some of them in this post.
Elder Financial Abuse
It is a very sad phenomenon to say the least, but unfortunately, elder financial abuse is widespread. This subject started to draw attention back in 2008 when the MetLife Mature Market Institute released an elder financial abuse study.
They found that seniors were victimized to the tune of at least $2.6 billion annually. The researchers conceded that it was very difficult to come up with a truly accurate estimate because most cases are never reported.
A study that was conducted several years later came up with an eye popping figure of $36.5 billion. The average amount that is lost by an individual senior is $34,200.
There are two main reasons why there are so many unreported cases of elder financial abuse. One of them is the simple fact that some seniors do not know that they are being victimized.
The other one is especially disturbing. In far too many instances, the perpetrators are family members or caregivers. They are never turned in because the elder that is being abused does not want to get them into trouble and/or lose the care that they are providing.
While there is no legal magic wand that can be waived to make elder financial abuse disappear, there are certain legal steps that can be taken to protect yourself in advance.
Long-Term Care Costs
Most senior citizens will need some type of help with their activities of daily living, and just over a third of elders will ultimately reside in nursing homes. The vast majority of seniors qualify for Medicare when they reach the age of 65, but this government health insurance program does not pay for living assistance.
If you have to move into a nursing home and pay out of your own pocket, the expenses can take a heavy toll on your legacy. In our area, the median annual charge for a private room in a nursing home was over $148,000 in 2019. Married couples may face two different rounds of nursing home bills, and these costs have been rising year by year.
Medicaid is the commonly embraced solution because it does cover nursing home care, but you can’t qualify if you have significant assets in your own name. An elder law attorney can help you position your assets wisely with future Medicaid eligibility in mind.
There is a federal estate tax that is a major factor for high net worth individuals. The exclusion is the amount that can be transferred before the tax would become applicable. During the current calendar year, it stands at $11.58 million, and the maximum rate is 40 percent.
In the state of Vermont, we have a state-level estate tax with an exclusion of $4.25 million. If your estate is going to be exposed to taxation, you have to take steps to gain estate tax efficiency.
We Are Here to Help!
As you can see, it is important to anticipate future events when you are planning your estate. If you pragmatically address these threats, you can preserve your legacy for the benefit of your loved ones.
We can gain an understanding of your situation and provide you with recommendations. When you make your decisions, we can develop a custom crafted plan that is ideal for you and your family.
You can schedule a consultation appointment right now if you give us a call at 802-879-7133. There is also a contact form on this website you can use to send us a message.