Planning for long-term care in your will and trust requires balancing protecting your assets and ensuring quality care in later years.

Long-term care planning can influence how your assets are managed and distributed. That’s why it’s essential to consider long-term care as part of the estate planning process. 

You’ll want to research assisted living facilities or in-home care service options, understand the financial requirements, and have an open dialogue with your loved ones about your long-term care preferences.  

Many people aim to leave an inheritance to their children or loved ones, but the reality of healthcare costs—especially in later years—often complicates those goals. While some prefer not to have their money go toward assisted living, it’s important to understand the trade-offs involved.

Medicaid Considerations

Medicaid is a joint federal and state program that gives health coverage to some people with limited income and resources. There are some special considerations if you need Medicaid to support your long-term care. 

If you want to preserve your assets for future generations, you might need to transfer them out of your ownership for at least five years before applying for Medicaid. However, this strategy comes with consequences. Relying solely on Medicaid may limit the quality of care you receive, as private pay options often provide more flexibility and a higher standard of living.

It’s not uncommon for people to exhaust their assets in assisted living, sometimes leaving Medicaid liens on their estate. To avoid such scenarios, it’s crucial to balance asset protection with ensuring you receive the care you need. A common approach is a hybrid solution: identifying the necessary amount of money for quality care and preserving certain assets for inheritance. For many, the peace of mind comes from knowing their care needs are met, even if it means leaving a smaller inheritance, but avoiding liens or further issues for their loved ones. 

Healthcare Power of Attorney

In addition to wills and trusts, a healthcare power of attorney plays a significant role in your long-term care planning. A healthcare POA allows someone to make medical decisions on your behalf if you cannot do so. This is especially important when dealing with medical appointments or treatments, where the person designated as your POA can ensure you get the care you need.

Ultimately, planning for long-term care isn’t just about protecting assets; it’s about ensuring your healthcare needs are met and you’re cared for in a way that aligns with your values and preferences. By taking the time to plan for both, you can ensure a smoother future for both yourself and your loved ones.