Sunday, 05 June 2016 02:51

Long Term Care - Part 1

Long-Term Care Part 1

 

The 65-year-old and over segment of our population is growing, and growing faster than those under 65 years old.  From the year 2000 to 2050, those in the age group of 65 years of age and older will grow by 147%, while those younger than 65 will only grow by 49%.  Moreover, on average, 2 out of every 5 persons 65 years of age or older will need some type of long-term care.  If you don’t have the proper planning in place, the high cost of care can force you out of your own home and into a nursing home.  I think it is fair to say this is a result that none of us want.  Forty percent of us will need some type of long-term care, so all of us should plan.

 

 

What is Long-Term Care?

Long-term care is a variety of both medical and non-medical needs that are performed for us by another.  The needs could include help with cooking, eating, cleaning, dressing, bathing, mobility, or medical care provided by a skilled nurse.  This assistance may be provided either in your own home, or in an assisted living facility, or at a nursing home.     

  

What does Long-Term Care Cost?

 There is no simple answer other than to say it can cost a lot.  The cost will depend on the amount of care required.  Is it just help cleaning and cooking?  Or does the person require 24-hour care?  Towards the lower end, the cost can easily be several thousand dollars per month.  Health insurance and Medicare does not cover long-term care in your home, assisted living facility, or nursing home.

  

How Do I Plan for Long-Term Care?

 The good news is that there are a couple of options available to help us plan for long-term care.  Everyone’s situation is different, so I strongly suggest you consult an attorney to discuss options more fully.  Some options include:

  • Private long-term care insurance
  • “Self-Insurance” or paying out-of-pocket for expenses
  • Life insurance to replace depleted assets used for funding long-term care
  • Utilizing a Trust to provide some asset protection
  • Use up all of your assets and live out your days in a nursing home

 

As you can see, some of these options are more desirable than others, and some may be out of reach.  These and other options will be discussed in future blogs.  Thanks for reading.

 

Please feel free to give me a call today and we can review your situation and other Estate Planning goals.  Everyone’s situation is different, and I can help create solutions. 

 

See lots of estate planning information on my website at: www.myestate-plan.com

 

William Daniel Powell (Dan)

619-980-2297

This email address is being protected from spambots. You need JavaScript enabled to view it.

 

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This document is for informational purposes only.  Nothing in this is to be considered legal advice.  Nothing in this shall create an attorney/client relationship, nor shall it create a confidential relationship.  If you need legal advice (in California), feel free to contact me or someone licensed to practice in your jurisdiction.  I assume no liability or responsibility for actions taken, or not taken, as a result of reading this information

Also, please remember that I speak in generalities in my blog and my website. There are so many different factors that can contribute and completely change the outcome that it would be impractical to discuss all of them here.

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Sunday, 03 April 2016 20:42

How Much is Federal Estate Tax

 

Federal Estate Tax

 How Much Federal Tax Will I or my Kids Have to Pay?

 

Usually one of the first questions that people ask when they start Estate Planning whether it be a Will, Revocable Living Trust, or other means of probate avoidance is something like “how much estate tax will I have to pay?” or “how can I avoid taxes?” or “how can I help my kids inheritance from being taxed?”.  It is easy to understand why the subject of tax is so important to so many of us.  It can really take a bite! 

 

 

The good news for the vast majority of us is that Federal Estate Tax won’t be an issue.    However, living in San Diego especially, and Southern California in general, can push some of us closer to the Federal Estate Tax.  This is so because of the higher value of our home.   Many different steps are used to compute the Federal Estate Tax, and there are many variables that affect what property is includible in a person’s gross estate in making such a computation.  For 2016, the Federal Estate Tax Exemption is $5,430,000.  This means that an individual can leave $5.43 million to their heirs and no Federal Estate Tax will be imposed.  A married couple can essentially leave $10,860,000 to their heirs without triggering the Federal Estate Tax.  This Exemption amount is indexed for inflation which means that the Exclusion amount increases each year.  As of now, the top federal estate tax rate is 40%.  These rules and amounts have changed quite a bit over the last 16 years, and there is no guarantee that they will remain where they are.  Democrats and Democratic candidates have suggested they would like to lower the Exclusion amount and increase the top federal rate to as much as 65 percent!  I won’t leave Republicans out of the discussion in saying who knows what goes through any politician’s head!

 

Because many actions (such as gifts, selling property, etc.) and different types of property can influence taxes, you should consult an attorney and potentially a tax professional.

 

Please see the rest of my Blog for more on Federal and California Estate Tax

 

See lots of estate planning information on my website at: www.myestate-plan.com

 

My most important job is to listen to you and your goals, then create the best estate plan to achieve these results.  Call me today and let’s start planning!

 

Thank you for reading!

 

William Daniel Powell

1-619-980-2297

 

****Reminder****

Just like my website, nothing in this blog is intended as legal advice. If you need legal advice, contact an attorney licensed to practice in your jurisdiction. I am licensed to practice law in California.  Further, please remember that I speak in generalities in my blog (and on my website). There are so many different factors that can contribute and completely change the outcome that it would not be practical to discuss all of them here. This is why I speak in generalities. Thanks again for reading.

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This document is for informational purposes only.  Nothing in this is to be considered legal advice.  Nothing in this shall create an attorney/client relationship, nor shall it create a confidential relationship.  If you need legal advice (in California), feel free to contact me or someone licensed to practice in your jurisdiction.  I assume no liability or responsibility for actions taken, or not taken, as a result of reading this information.

 

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