Financial Analyses of a Will Versus a Medicaid Trust Program

I met with a couple this morning that had been highly referred to me by other clients. They were both retired and have never engaged an estate planning attorney before. Some of the main issues they had that they expressed to me included:

  • Making things easy for the surviving spouse after one spouse dies;
  • Making sure things go to their children and grandchildren the right way.
  • Making sure their daughter-in-law (who they love and trust without hesitation) can do things for them in later years if their son cannot.
  • Protecting assets if either of them has to go into a nursing home in the future.

They were in their late 60's but they had some health issues. The husband was eager to make a financial analyses of the different types of estate planning programs he could set up. Once we finished going through everything, he analyzed it like this>

  1. Will. He stated that if he and his wife had a WIll-based estate plan, that they could very possibly lose their $300,000 of investment, their land, and ultimately their home if they went into a nursing home. He realized that even if they never entered a nursing home, the fact that the Will requires probate to get assets transferred means their estates would incur an estimated $6,000 to $15,000 of total probate cost at each death. So, he said, the ultimate cost of the Will-based estate plan would be anywhere from $12,000 to $500,000, depending on the probate costs and whether they ever entered a nursing home as private-pay patients.
  2. Medicaid Trust Program. He then did a financial analyses of the Medicaid Trust Program. He realized that if he and his wife stayed out of the nursing home for at least five years, that this program would protect all of the value of their investments, their home, and their separate tract of real estate. He also realized that by having his assets in a trust, a probate (actually two probates) would not be necessary in the future because assets in a trust can be disbursed to a beneficiary without having to go through probate.

After analyzing everything, he told his wife the correct decision was a "no-brainer". Actually, his wife was way ahead of him because she had read my book in advance of coming into the office, so she knew she wanted the Medicaid Trust Program even before we started talking.

If you live in South Louisiana and want to give your family the benefits of preserving everything you own from the government or others, and you want to make it easy to transfer your wealth to your heirs, give us a call at 866-491-3884. It all starts with a chat with one of our estate planning attorneys who will walk you down the path of making sure everything is in order and protected.