Cases of caregiver abuse and movies like “I Care A Lot” have illuminated the importance of protecting the elderly from unscrupulous people. Elder law and estate planning are complementary but different avenues of protection.
What Is Estate Planning?
During estate planning, a lawyer guides you through establishing a plan for how you want your property divided after you die and also puts in place certain provisions for circumstances while you are living. The focus is on what happens when circumstances prevent you from being able to make decisions for yourself.
- Will. A will can set your intentions about the division of your property and who should care for any children after you die. Wills can reduce family conflict in the aftermath of your death. It is important to know that your spouse does not automatically inherit everything when you die. With no will, Texas law determines your heirs based on close blood relationships, and that does not include your significant other or stepchildren.
- Advance Directive. This document outlines your wishes about medical care and end-of-life decisions and is sometimes called a living will. Through this legal document, you can address DNR (Do Not Resuscitate), medical power of attorney, and other directives to family or surrogates.
- Medical Power of Attorney. This designation names who you want to make healthcare decisions for you should you become unable to do so yourself.
- Special Deeds. There are several different types. A Transfer on Death Deed allows you to name a beneficiary to receive your property after you die and avoid probate. A Life Estate Deed transfers real property to beneficiaries while you are still alive and gives you the right to occupy the property during your lifetime. You also are responsible for the mortgage and taxes.
What Is Elder Law?
Where estate planning is geared toward what happens after you die, elder law focuses on how you want to live during your golden years. Certain legal steps allow you to use your assets to create the lifestyle you want as you get older.
There are several ways elder law in Texas can help you provide for your later years and avoid losing all your assets. Let’s look at a few tools that can help safeguard your future.
- Lady Bird Deed. Available only in Texas and four other states, this deed differs from a Life Estate Deed in that you can still sell or mortgage the property. This is helpful if you want Medicaid to pay for long-term nursing care. To qualify, Medicaid requires your assets be below a certain level. The value of your home might put you over that threshold. With this deed, Medicaid does not include its value in the calculation.
- Durable Power of Attorney. Should you become incapacitated, you want to know who will make decisions on your behalf. A Durable Power of Attorney can make legal, business, and financial decisions for you.
- Living Trust. When you create a trust, you can determine which assets are to be included and name a trustee to manage the trust. You also name beneficiaries of the trust’s components. With a living trust, the trustee can step in to manage assets and pay bills should you become unable to manage your affairs. Living trusts are also revocable trusts, meaning they can be changed at any time. The asset value in this trust is counted by Medicaid when determining whether you qualify for long-term care assistance.
- Irrevocable Trust. As the name suggests, this trust cannot be changed without the consent of all beneficiaries. While this has its obvious disadvantages, the big draw is that you no longer own what is included in the trust. Medicaid will not consider assets in this trust when determining eligibility.
A quick note about Medicaid’s “look-back” period: Medicaid penalizes you for any gift or transfer you make, even to a trust, that happens within five years of applying for assistance. Medicaid can deny assistance based on this look-back period.
Protecting Our Seniors
According to the National Council on Aging, 10% of Americans aged 60 or older have been victims of elder abuse. Elder law in Texas also has areas that overlap with family law, such as guardianship matters, fraud, nursing home abuse, and other issues.
Why It Is Important to Be Proactive
Without proper planning, you leave yourself and loved one susceptible to the laws and whims of the legal system. With proper planning, you can protect your assets and save heirs from pricey tax burdens. But financial considerations are just the beginning. Our experienced estate planning and elder law attorneys can draft plans that establish who raises minor children and who gets beloved pets, while reducing fighting over who gets what.
Our legal professionals at The Springer Law Firm PLLC offer a comprehensive approach, using all the tools of estate planning and elder law. Put our more than 85 years of family law experience to work for you.
Contact us online or by calling (281) 990-6025. It is never too soon to protect your future.