Month: May 2017

Legal Documents for Your 18 Year Old

The law says that kids become legal adults the day they turn 18.  So what does that mean?  Yes, they can vote…but what else? When a child turns 18, parents no longer are able to make health care and financial decisions for the child without written legal authorization.

Imagine being a parent of an 18 year old.  Now imagine that the child is in the hospital due to an emergency situation.  Without the proper planning, doctors are unable to share information with you.

Imagine your 18 year old is a victim of fraudulent use of their credit card.  As the parent, since your child is a legal adult, banks will not communicate with you about this.

So what is the solution?

Together, parents and children should review and discuss several important legal documents with the understanding that it’s the child’s right to decide how to proceed. Important documents to review include:

  • Medical Power of Attorney – Gives parents the authority to make medical decisions on a child’s behalf if the child is unable to do so.
  • Living Will – States a person’s wishes about life-extending medical treatment.
  • HIPAA Release –Allows heath care providers to release medical information with designated people.
  • Durable Power of Attorney – Grants parents the authority to sign documents for their child. For example, this allows a parent to manage financial accounts or file a tax return on behalf of the child.

Without these documents, the courts will make decisions for you. Therefore, it is important to have this difficult discussion with your children.

It’s Not Too Late to Protect Assets

People often believe that when they enter into a nursing home, it is too late to do any planning. However, this could not be further from the truth.  The truth is it’s never too late to legally protect assets.

Just the other day, we helped a client who was already in a nursing home. We gifted part of her estate to her family while she remained eligible for government assistance to pay for her nursing home care.

The client entered the nursing home in January.  We were contacted in April in regards to protecting some of her assets for nursing home.  Her assets were around $130,000.00 and kept in money market accounts.  We used a Medicaid Compliant Annuity which allowed her to gift approximately $58,000.00 to her family.  The remainder of the money will go to pay for her nursing home payments for the next 6 months.  During this time period, we will apply for government assistance which will continue making the payments to the nursing home after her 6 moth payment period expires. This example demonstrates that it is never too late to plan for nursing home.

Cases like this happen all the time, people enter a nursing home and loved ones assume that they it’s too late to do any asset protection planning. Don’t assume that it’s too late! Unless your assets are already gone, it’s never too late.

A phone call to learn about asset protection from nursing home costs won’t cost a thing…but not making that call could cost everything.