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Funeral  Trust  Explained
 

Funeral Trust Explained

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The Asset Protection Funeral Trust

The Asset Protection Funeral Trust

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    Funeral  Trust  Explained Funeral Trust Explained Presentation Transcript

    • WELCOME THE BEST GIFT YOU CAN GIVE EACH OTHER IS KNOWING YOUR ESTATE PLANNING IS UP TO DATE Alvin Penry California Insurance Lic # 0658044 Toll free…1-800-343-7330 Email:  [email_address] or Dale Froehlich Wisconsin Insurance Lic # 1109669 Email: [email_address]  
    • ESTATE PLANNING
      • PASSING YOUR ESTATE TO YOUR LOVE ONES IN THE MOST EFFICIENT MANNER
      • WHAT IS PROBATE AND HOW TO AVOID PROBATE
      • ADDRESSING POTENTIAL FEDERAL ESTATE TAXES
      • SAFE MONEY INVESTMENTS
      • HOW TO ADDRESS NURSING HOME ISSUES
      • NEW ANNUITY WITH LTC BENEFIT THAT COULD PROVIDE THOUSANDS OF EXTRA DOLLARS FOR NURSING HOME COSTS
      • MEDICAID PLANNING SOLUTIONS THAT NEED TO BE DONE NOW!
      • MEDICAID PLANNING SHOULD BE DONE WITH AN ELDER LAW ATTORNEY
    • Estate Planning Should be Reviewed after the New Federal Law was signed by President Bush on February 8 th , 2006. SWEEPING MEDICAID LAW CHANGES. “ The Deficit Reduction Act of 2005” MEDICAID LAW CHANGES
    • MEDICAID PLANNING IS VERY COMPLICATED
      • GIFTING AND DIVESTMENTS MUST BE COMPLETED 5 YEARS PRIOR TO APPLYING FOR MEDICAID ELIGIBILITY
      • ANY GIFT DONE WITHIN FIVE YEARS OF THE MEDICAID APPLICATION WILL BE BROUGHT FORWARD AND MAKE YOU INELIGIBLE FOR ASSISTANCE.
      • YOU SHOULD ALWAYS CONSULT AN ELDER LAW ATTORNEY OR YOUR ESTATE PLANNER BEFORE YOU MAKE GIFTS OR DIVESTMENTS. THE LAWS ARE VERY STRICT ON WHAT YOU CAN DO NOW.
    • Deficit Reduction Act for 2005 DIVESTMENTS AND GIFTS
      • EXTENDING THE THREE YEAR TRANSFER RULE ON ASSETS TO A FIVE YEAR RULE. The Old Rule was from the date of transfer, the new rule is from the date of Medicaid Application.
    • The New Rules will affect every Senior Citizen in America!
      • To Protect Assets, you must give assets away five years ahead of time before applying for Medicaid.
      • Advance planning is more important than ever.
      • The average Senior Citizen by the time they apply for Medicaid will be dead Broke!
    • YOU WILL HAVE PEACE OF MIND ONCE YOU REVIEW YOUR ESTATE & FINANCIAL PLANNING. PLANNING IN ADVANCE IS THE BEST PLAN!
    • MEDICAID ELIGIBILITY
      • SINGLE PERSON
      • $2000.00 Assets
      • $1500.00 life Insurance
      • $4500.00 automobile
      • Personal possessions
      • WITHOUT PLANNING YOU CAN SEE THAT THERE IS NOT ENOUGH MONEY TO PAY FOR FUNERAL EXPENSES.
      • States will vary for Medicaid eligibility.
      • Check your state for details or consult an elder
      • Law attorney
      • MARRIED COUPLE
      • SPOUSAL IMPOVERISHMENT PROTECTION
      • Home – Exempt
      • $50,000.00 – community
      • $ 2,000.00 – confined
      • Automobile – unlimited value
      • Income for community spouse - $2300 approx.
    • Medicaid will Consider Life Insurance Policies over $1500.00 as a “Countable Asset”.
      • Example: widow is in a nursing home and has a $5,000.00 old life policy with $4800.00 cash value.
      • The Nursing home is costing her $6350.00 per month and her total assets are now down to only a checking account with $7000.00.
      • Without planning she will end up spending the cash values and bank account down to $2000.00 to become eligible for Medicaid.
      • THE ONLY PROBLEM…THERE IS NO MONEY LEFT TO COVER THE COST OF A FUNERAL…BECAUSE THE STATE WILL TRY AND RECOVER THE $2000 THAT IS IN THE BANK ACCOUNT AFTER DEATH OF A MEDICAID RECIPICANT.
      • *MEDICAID ELIGIBILITY MAY VARY FROM STATE TO STATE.
    • The Irrevocable Funeral Trust is not a Divestment or gift!
      • Because the purchaser of an Irrevocable Funeral Trust receives fair market value, it is not a divestment. (Not Subject to transfer rules)
      • Exempt as soon as the client signs the Irrevocable Funeral Trust Agreement.
      • Medicaid and the Nursing home can’t count money in the Funeral Trust as a countable asset.
    • SOLUTION TO THE WIDOW’S PROBLEM OF NOT HAVING ENOUGH MONEY FOR FUNERAL EXPENSES.
      • To Be eligible to apply for Medicaid, most states only allow $1500.00 for life insurance
      • $5,000 Paid up whole life insurance policy. (*cash values are $4800) The Widow was planning to use this policy for her funeral. The only problem is that we need to apply for Medicaid… This life insurance would be a “Countable Asset” under Medicaid.
      • Why not 1035 this policy into the Irrevocable Funeral Trust Final Expense plan and now the entire amount of $4800.00 would be exempt. THEREFORE SAVING THE ENTIRE AMOUNT UNDER THE FUNERAL TRUST. Now this entire amount is EXEMPT when applying for Medicaid.
      • We could also add $5000.00 from her Checking account to the life Insurance cash values of $4800.00 and protect $9800.00 Total and qualify for Medicaid Today without spending a dime.
    • IT IS NEVER TOO LATE IN MOST CASES TO PROTECT SOME ASSETS.
      • CONSULT AN ATTORNEY TO COMPLETE YOUR ESTATE PLANNING WITH THE FOLLOWING LEGAL DOCUMENTS.
      • DURABLE POWER OF ATTORNEY
      • HEALTH CARE POWER OF ATTORNEY
      • LIVING WILL
      • IF YOU ARE NOT ABLE TO MAKE DECISIONS,THE POWER OF ATTORNEY CAN DO THIS FOR YOU. USUALLY A FAMILY MEMBER THAT YOU CHOOSE.
    • Many clients have come into my office and said I have a $10,000 Whole life Policy. I plan to use this for my funeral expenses. (CASH VALUES $9850.00)
      • Only $1500.00 is exempt if you are going to apply for Medicaid.
      • The entire $9850.00 in cash values would be a “Countable Asset”.
      • Why not 1035 this cash value of $9850.00 into the Funeral Trust.
      • Now all of this policy is EXEMPT from the nursing home and Medicaid.
    • NURSING HOME CASE – MEDICAID SPOUSAL IMPOVERISHMENT STATES WILL VARY FOR COMMUNITY SPOUSES ASSET ALLOWANCE. CONSULT AN ATTORNEY
      • MOST STATES ALLOW THE COMMUNITY SPOUSE TO HAVE $50,000.00 AND THE CONFINED SPOUSE WITH $2000.00 TO BE ELIGIBLE TO APPLY FOR MEDICAID.
      • PROBLEM: THEY HAVE $77,000.00 IN BANK ACCOUNT. THEY HAVE $25,000 TOO MUCH! WITH NO PLANNING THEY WOULD HAVE TO SPEND THIS AMOUNT ON THE NURSING HOME.
      • SOLUTION: SET UP (2) FUNERAL TRUSTS FOR $12,500 EACH OR TOTAL OF $25,000.
      • APPLY FOR MEDICAID TOMMORROW.
    • SECURITY BY USING IRREVOCABLE FUNERAL TRUST AGREEMENT
      • FUNDS ARE PAID FIRST TO THE FUNERAL HOME WHICH ACTUALLY PROVIDES SERVICE, EXCESS FUNDS GO TO ESTATE
      • THESE FUNDS CANNOT BE ATTACHED BY CREDITORS, SUCH AS: NURSING HOMES, HOSPITALS, LAWYERS, OR MEDICAID
      • INCOME TAX-FREE BENEFITS UPON DEATH
      • DEATH BENEFITS AVOID PROBATE COSTS AND DELAYS
      • INCREASING DEATH BENEFIT ANNUALLY – 2.00% GROWTH
      • THE FUNERAL TRUST IS NOT A DIVESTMENT…IT IS IMMEDIATELY PROTECTED FROM THE NURSING HOME OR MEDICAID!
      • MAY VARY FROM STATE TO STATE
    • THE BEST PERSON TO HELP YOU FUND YOUR LEGAL IRREVOCABLE FUNERAL TRUST IS YOUR ESTATE OR FINANCIAL PLANNER.
      • The Funeral Home may not be there when you pass away.
      • You might move to a different city or retire down South.
      • Funeral homes are changing names and ownership faster than banks.
      • Funeral Trusts with final Expense insurance do not specify any particular funeral home, instead THESE trusts can be used with any licensed funeral home at the time of death. Providing Flexibility if you move or retire down South.
    • Alvin Penry California Insurance Lic # 0658044 Toll free…1-800-343-7330 Email:  [email_address] Or Dale Froehlich Wisconsin Insurance Lic # 1109669 Email: [email_address]   Questions?