Ideally, financial planning for seniors will cover several stages of their lives — the pre-retirement years when wage-earners are still acquiring financial resources and assets, retirement age for active seniors when they reap the fruits of their years of labor and the inevitable advanced elder years when they or their spouse may be living with serious illness or disability.
Texas residents concerned about Medicaid eligibility if it becomes necessary can take advantage of the five year look-back window by planning ahead on the disbursement of assets to cherished family members or endowments to institutions or charities. As individuals on the receiving end of any legacies will have their own tax ramifications with which to deal, it’s a good idea to make prospective heirs and beneficiaries aware of any charitable intentions so that they may plan accordingly themselves.
Even during the five-year period prior to Medicaid qualifications, some types of asset transfers are allowable under certain circumstances. An elder law attorney will be able to advise Texas residents of the laws in their jurisdiction and help them remain compliant.
Depending on several factors, seniors may still qualify for Medicaid benefits while retaining ownership of the family home, which in some cases may be valued at up to $700,000. If the home is worth more than that amount, seniors may wish to discuss downscaling prior to the five year window.
In cases where one spouse requires Medicaid, the other may still earn up to nearly $3,000 per month. If the spouse is accustomed to earning more than that, he or she may reduce their hours or scale back their job duties and assume a lesser role. This can also free up more of their time to spend with their ailing spouse while still allowing them some earning potential.
To learn how Medicaid eligibility rules affect your particular situation, schedule a consultation with a Texas elder law attorney who can advise you of your financial options.
Source: Wall Street Journal, “Wealth Adviser: Keeping a Firm Grip on Family Fortunes” Kevin Noblet, Feb. 14, 2014