I am often asked why we should worry about planning for long term care. It is a good question, but I think before we can talk about the why we should talk about the what: What is long term care? We hear that phrase all over the place, so what does it actually mean? Long term care happens in that phase of life when a person can no longer manage his day-to-day activities without someone else’s assistance; that “helper” is often referred to as a caregiver. The caregiver’s services might take place in the home, or it might take place in a nursing facility. It might require the assistance of family members, or a recipient could need outside help from a private agency or a friend who is acting as a caregiver. It is called “long term” because the idea is that once a person starts needing this kind of care, that person will not stop needing it.
So, why is this a big deal, right? If family can help out, why do we even need outside assistance? Simply, not everyone has family who can help. Caring for a loved one who needs this level of assistance can also be physically, emotionally, and mentally exhausting. For most of us, we simply are not trained or experienced enough to take on the responsibilities caring for an elderly loved one might entail. Certain medical conditions are also dangerous to care for at home – dangerous for the caretaker and for the one who requires care. Many nursing facilities are set up to provide a safe environment for the loved one to receive proper care and support.
Whether it takes place in the home or a facility, it is important to keep in mind that long term care can be expensive. If you can privately pay for it, it will cost thousands a month to maintain that care. If you cannot privately pay for it, the state can step in and help, but the state has a right to get paid back from the assets in your estate after you pass away. We take the steps we take to protect our assets because we don’t want to lose them to the costs of our long term care.
Not everyone is going to need long term care, but the hard reality is that we do not know if we are going to be one of the lucky ones who does not need it. We can almost view it like a game of chance, so the question becomes whether we take proactive steps to protect our assets in case the odds are not in our favor.
Having the conversation about how best to protect your assets from long term care expenses sooner rather than later creates an environment where we have many more options for the kinds of plans we can create. We have flexibility, and can usually protect more assets from the potential costs. We can also usually craft plans that will still meet your ultimate estate planning goals, meaning your assets can still go to the people who you want to receive them. Proactive planning allows you to maintain control over how your assets are protected, and it preserves those assets for future use.
The closer a person gets to needing long term care, the fewer options for planning we have. Planning in a crisis situation usually means selling assets and spending money you otherwise could have saved.
Planning in advance has its negative characteristics, too, but whether and how to protect your assets is a conversation worth having sooner rather than later.
So we plan for long term care expenses because we never know if we could be the person who needs a caregiver; we worked hard for what we have and we should get to pass it on to those we love when we die; and because it gives us the peace-of-mind to know that we took the time to care for ourselves, and set ourselves up for our best possible futures. If you want to know more about what planning steps might be available for you and your family, give us a call.
Candace Augustine, Esq