I am 52, single and live in NJ. I am disabled and receive Soc Security Disability and use some of my savings each year to make ends meet. I'm worried about the worst happening....... needing long term care if my health worsens and I want to protect my money from Medicaid for my nephews & neice. I'm familiar with the 5 year role for transferring assets, but are there any other ways to protect my assets without actually giving it to my nephews/neices and having to hope that I don't have a major illness in the next 5 years? I do need some money each year as mentioned earlier and giving it to them now worries me.
It's not really possible to give you a helpful answer on this without going through your assets and your plans in some detail, but in general: Medicaid counts certain assets in its determination of what you have for purposes of qualifying for services. Other assets are noncountable. Medicaid planning is a dance, converting countable assets to noncountable assets while making sure you have money to keep yourself afloat in the meantime. I'm inclined to agree without even seeing everything that "give everything to the nephews/nieces and pray for 5 years" is not a good approach. But how much can you move around? Are there ways to shield other assets through alternative strategies such as annuities (if done carefully)? The best way to find out is to have a consultation with an elder law attorney who does Medicaid work. I happen to be such an attorney, but I may be too far north for you. If you want to talk to someone more local, give me a call and I'll get you a name.
Carl Archer
609-452-8411 x117
An irrevocable asset protection trust will help you to accomplish these goals. You should see an estate planning attorney to help ascertain your options.
You have a few options. If you feel confident regarding your financial needs, you could convert some of your assets into income by purchasing an annuity or establishing an income only trust. You also might be able to make exempt gift depending on circumstances. Various Medicaid planning techniques may or may not make sense for you. I have a lot of information on special needs and Medicaid planning on my website. Carl has given a pretty good overview of how Medicaid planning works. Now you really need an individual elder law attorney consultation.
Lawrence Friedman, Bridgewater, NJ. Certified as an Elder Law Attorney by the ABA approved National Elder Law Foundation, former Chair NJ State Bar Association Elder and Disabilities Law Section, Member Board of Consultors of NJSBA Real Property, Trusts & Estates Law Section, Vice Chair Special Needs Law Section of National Academy of Elder Law Attorneys, and Master of Laws (L.L.M.) in Taxation from N.Y.U. School of Law. Visit SpecialNeedsNJ.com for articles and Q&A on elder law, special needs, wills, trusts, estates, and tax and SpecialNeedsNJ.com/blog for timely updates. Information on both and SpecialNeedsNJ.com does not constitute legal advice, as it is general in nature and may not apply to your situation or be subject to important changes. No attorney client relationship exists unless set forth in written engagement terms.
