3.19March

Supplemental Needs Trust
By: Jerry Creed / Trust Jerry
It sucks, and there is no easy way to say it…
In a marriage, chances are one of you is
going to die before the other. Even worse, in most
marriages it’s going to be the man that is going to die first.
One of the top worries for a man is will my wife have enough money
to get to the end of her days without running out of money?
What if my wife gets Dementia, Parkinson’s or Alzheimer’s and has
to go into a memory care facility or skilled nursing facility and I’m no
longer around to see she is taken care of. They cost an average of $8,000
a month or about $100K a year.
Medicaid will help but only after my surviving spouse had spent
down to less than $2,000 in assets. My wife will be impoverished before
the government helps.
Is there a way to protect your spouse, a way to ensure she never runs
out of money before she runs out of days? Is there a good way to protect
your spouse against creditors, bankruptcy, Medicaid?
Good news! There is a way, and if you’re married, you’ve already
taken the hard step. Most married couples should take advantage of
this Medicaid loophole, but haven’t yet.
There is a Medicaid provision that allows a Supplemental Needs
Trust created by a testamentary instrument by a spouse for the
surviving spouse to be exempt from the 5 year look back and from
Enhanced Medicaid Recovery.
Said in nonlawyer
speak,
your estate plan
should be based
on a revocable
living trust and
a pour over Will.
The pour over
Will can create
a supplemental
or special needs
trust for your
wife using your half of the community assets when you die. This is a
Trust created by you, for your wife’s benefit.
Your wife’s creditors can’t reach the assets because the assets in the
Supplemental Needs Trust are not your wife’s they are your assets set
aside to be used for your wife, not “controlled” or “owned” by your wife.
Better yet, if your wife needs to go onto Medicaid to pay the memory
care or skilled nursing bill, Medicaid doesn’t count those assets when
your wife is trying to qualify and will not be able to recover those assets
when your wife dies. Your assets will be there for your wife and then go
to your children or heirs.
To learn more, contact an Elder Law Attorney or come to one of my
free seminars.
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