It’s Not too Late to Protect Your Assets from Long-Term Care Costs (Even if You’re Already in a Nursing Home)

You don’t usually get a heads up when a nursing home will be needed. That’s why so many people are caught off guard when it happens and make decisions under stress that they might not have made otherwise—including decisions that put their assets at risk. Thankfully, if you’ve found yourself in this position, the ship has not sailed on the opportunity to protect yourself, even if you’re already in a nursing home. 

Sink or Swim Decisions 

When you move into a nursing home, financially you have two options: sink—and lose all your money—or swim and make choices that can save some of your assets. Here’s what that means.  

If you’re single and you do nothing to protect yourself, all your assets will go towards paying for your care. You’ll keep a measly $2,000. If you’re married, your spouse can live in the house, but it will be subject to a future lien. The most that a healthy spouse gets to keep is about $130,000. Suffice to say, this can leave your spouse with little to count on. 

To avoid this, some people will try to draw down their estates by giving away their assets to family and friends in order to qualify for Medicaid coverage. But this presents its own set of problems. Medicaid has a look-back period of five years, meaning transfers made in the five years prior to receiving coverage can render you ineligible.  

Your Life Preserver 

Thankfully, elder law attorneys can be your life preserver in this difficult scenario. Just as accountants help you save money in taxes, elder law attorneys can minimize how much money you lose to long-term care costs.  

One tool an elder law attorney may recommend is an asset protection trust, which helps shield your assets from the nursing home. If you’re not currently in a nursing home, this strategy may save you or a spouse heartache down the line, especially if implemented at least five years prior to when a long-term care facility is needed. 

In some scenarios you can transfer assets without compromising Medicaid eligibility, even if you are in a nursing home. However, they’re not always easy to understand. Having an elder law attorney can help you navigate the ins and outs. They can also advise on which assets you can safely keep in your name.  

How to Orient Yourself for Smooth Sailing 

The bottom line is: the sooner you start planning, the more assets you’ll be able to save. But even if you haven’t started planning, it’s never too late to right the ship. Your first step is finding the right elder care attorney for you. Since we know it can be difficult to figure out where to start, we’ve created a guide with all the important questions to ask the attorneys you’re considering. Download it to help you find your best match and enjoy smoother sailing going forward.