Whats Next Workshop 2010

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Whats Next Workshop 2010

  1. 1. MEDICAID AND ESTATE PLANNING: HOW TO DEVELOP A PEACE OF MIND P. Haans Mulder, JD, MST, CFP® Cunningham Dalman, P.C. 321 Settlers Road Holland, MI 49423 (616) 392-1821 phmulder@holland-law.com What’s Next Workshop 2010
  2. 2. Background • Partner at Cunningham Dalman, P.C. • Masters in Tax, CFP®, and specialize in estates/elder law and business planning • Cunningham Dalman, P.C. has been serving the greater Holland/Zeeland since 1900 Serving the Holland area since 1900
  3. 3. Overview • Medicaid process and eligibility rules • Example of how Medicaid planning works • Parts of an estate plan and process • Most common types of estate plans Serving the Holland area since 1900
  4. 4. Did you know? • 40% of people 65 years and older will stay in a nursing home • Average cost to stay in a local nursing home is $6-7,000/month Serving the Holland area since 1900
  5. 5. What is Medicaid? • State and federal program that pays for medical treatment (including nursing home care) • Oftentimes confused with Medicare Serving the Holland area since 1900
  6. 6. When does Medicaid apply? • Must be in a nursing home • Applies to people who are 65 years or older, blind, or disabled • Must pass the income and asset tests Serving the Holland area since 1900
  7. 7. Who does Medicaid apply to? • You cannot have enough income to pay the monthly cost of staying in a nursing home ($6-7,000 in this area) Serving the Holland area since 1900
  8. 8. Who does Medicaid apply to? • A single person cannot have more than $2,000 in countable assets • Can keep your home (it’s not in your trust) and a vehicle • All other assets are countable Serving the Holland area since 1900
  9. 9. Who does Medicaid apply to? • Asset test allows a married couple to keep their home (again, if it’s not in a trust), a vehicle, and one-half of their other assets Serving the Holland area since 1900
  10. 10. Example • Clients were husband and wife • Wife had to go to a nursing home • Didn’t stay in a hospital for three days so Medicare didn’t cover stay • Had house, vehicle, and investments Serving the Holland area since 1900
  11. 11. Example • Could keep the house (because it was properly owned) and their vehicle • Without any Medicaid planning, they would have had to spend down one- half of their investments Serving the Holland area since 1900
  12. 12. Example • Drafted a trust that allowed them to protect all of their investments (as opposed to just half) • This provided peace of mind to the husband Serving the Holland area since 1900
  13. 13. Did you know? • You could save approximately $5,000 by having an estate plan prepared for $850 Serving the Holland area since 1900
  14. 14. What is estate planning? • Process of planning for the future management and distribution of your assets and your future medical care • Includes documents such as wills, trusts, and powers of attorney
  15. 15. Why is it important? • Reduces the cost of administration • Minimizes stress for family and friends • Determines who will receive your assets • Authorizes who will make your medical decisions
  16. 16. What is probate? • Probate is a court process to administer a deceased person’s financial affairs • Required when someone passes away with assets in his or her own name or fails to name a beneficiary
  17. 17. Why avoid probate? • It is a public process • Can exacerbate family situations • Can be expensive to administer (between 3-8%) • Takes time to complete (6-9 months)
  18. 18. What are the most common estate plans? • Basic plan includes wills (potentially with a trust) and powers of attorney • For clients who do not have a house or are not concerned with avoiding probate
  19. 19. What are the most common estate plans? • Other plan includes a living trust, pour- over wills, and powers of attorney • Plan is designed for clients with grown children and who desire to avoid probate
  20. 20. What does the estate planning process look like? • Complete estate planning questionnaire • Attend a meeting that we discuss your goals and the types of estate plans
  21. 21. What does the estate planning process look like? • Review draft of documents • Attend a signing conference • Change beneficiaries or/and fund your trust
  22. 22. Questions…… Serving the Holland area since 1900
  23. 23. Thank You P. Haans Mulder Cunningham Dalman, P.C. 321 Settlers Road Holland, MI 49423 (616) 392-1821 phmulder@holland-law.com www.holland-law.com Serving the Holland area since 1900

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