TEN WAYS TO PROTECT YOUR MONEY

Posted:  Thursday, July 19, 2018 - 7:30am
Share: 

Story Location:
66 Elm St.
Camden  Maine  04843
United States

TEN WAYS TO PROTECT YOUR MONEY AND YOUR HOUSE FROM MEDICAID OR A NURSING HOME

Common Misconceptions and questions from clients to an attorney and his answers.

Misconception #9.

GIVE YOUR STUFF AWAY (60 MONTHS BEFORE APPLYING)

Nursing Home Costs and the Five Year Lookback

What is this 60 month rule? When answering the question how can you protect your money from medicaid, first you must understand what medicaid is. Medicaid is a government program that pays for a nursing home if you can’t afford it. In Maine it is called Mainecare. But how does Medicaid or Mainecare know if I can afford it? They look at 60 months, or five years’ worth of your financial history. That is the 60-month rule or the five year lookback with nursing homes and Medicaid. So, you say to me, what if I give my stuff away 60 months or 5 years before I apply. “Yes!” The lawyer says, “that will work”.

Gifting Strategies that Don’t Work

However, now you’re back to our number 10 on the top ten list. You have no stuff. But, you say, won’t the person I gave my stuff to be so grateful for the gift that they’ll use it to pay for my private room? Remember the private room in number 10? For “private room” fill in the blank with anything you (or your spouse) might want that will make your quality of life a little better but may not be covered by Medicaid. Or maybe you aren’t in a nursing home. Now you’re the one who has an expensive home repair. Or maybe you just want to buy a new car.

“Yes!” The lawyer says, “that will work… BUT now you have no stuff!”

Well, the person or persons (the kids maybe?) you gave your stuff to 60 months and one day ago may be so grateful that they will buy you that car or fix your house. And if you’re in a nursing home already they may visit, and find out what you need, and pay for it with what was formerly your money.

Maybe the person you gave the money will use it for you… maybe they won’t

What Happened to my Stuff?

But they may not. They may decide that you don’t need it any more. Even if they’re the kind who never forgets, guess what? They just got served with divorce papers, and your ex-son-in-law or ex-daughter-in-law doesn’t want to use his or her share of your stuff to pay for your fussy quality of life in a nursing home. Now substitute divorce for law suit, or bankruptcy, or bad investment, or college tuition, or drug habit, and you get the idea of where your money went. Oh, wait, I misspoke, it’s not your money any more, you gave it away. So, number 9, giving your stuff away 5 years and a day before applying for Medicaid to pay for your nursing home does not insure that you may benefit from it again – even with a loyal kid.

Stay tuned for Misconception #8 tomorrow.

For more information on How to protect your stuff or to start planning YOUR estate, please call Penbay Estate Planning Law Center at 207-236-4888, follow us on Facebook, or visit our website www.penbaylaw.com

AND PLEASE....

Don’t leave your family’s plans in someone else’s hands.™