Why is Estate Planning for Seniors So Unique?
Over the past couple decades, there’s been a seismic shift in the estate tax landscape coupled with the fact that people are living considerably longer. Before 2010, California estate planning was almost always focused on reducing transfer taxes, among other things. There are countless variables and complexities to this type of planning, but since 99 percent of society is no longer facing death tax concerns, estate planning for people under the age of 65 is relatively simple in comparison to the estate planning asset protection needs that seniors face today.
In other words, the old way of setting up complicated tax focused trusts have become completely unnecessary for most people because they can now give away over $5,000,000 ($10,000,000 for married couples) tax free. On the other hand, people are living longer with seemingly less assets and income to support their lifestyle and care. How much income and assets are needed for care costs as people age, you wonder? Well, skilled nursing costs can easily exceed $8,000 per month. As a more extreme example, last year I had a 68-year-old client who suffered a brain injury and to this day, his care costs are $1,130 per day! At that rate, it wouldn’t take long for most seniors to go broke.
Fortunately, the family of my 68-year-old client – as well as an increasing number of seniors nowadays – are not relying on general or old tax and probate avoidance trusts to handle these types of problems.
Instead, many wise seniors are thinking about asset protection and elder law planning. With care costs continually rising, asset protection trusts are simply not a luxury for the “rich” anymore. Indeed, they are really a necessity for many seniors who hope to qualify for Medi-Cal and/or Veterans Aid and Attendance Pension Benefits, in order to help pay for rising long-term care costs.
Moreover, for many families the asset protection analysis does not end with the seniors themselves. That is, once seniors realize the benefits of asset protection planning, they are usually focused on providing a similar type of protection for their loved ones. Indeed, knowing the likelihood that one (or more) of their children might wind up in trouble (e.g., getting divorced, having a costly uncovered medical condition, or business failure/foreclosure/bankruptcy, etc.), many seniors not only choose to protect themselves from rising care costs, they also create a plan within their plan to protect their children too.
To make sure your estate plan does what you want and need it to do, please contact Randall F. Kaiden, Esq. of Valley Elder Law at 661-247-8433, or via our website: www.valleyelderlaw.la.
ADVERTISE WITH US
Santa Clarita’s chapter of Junior Chamber International (JCI) and The Magazine of Santa Clarita are pleased to host the annual SCV 40 Under Forty Awards. The award ceremony celebration will take place at the Hyatt Regency Valencia on November 17. This year marks the...read more
West Ranch High School’s Wildcat Colorguard team finished 14th in the Scholastic A Division of the Winter Guard International’s World Championships in Dayton, Ohio. The 27 students making up the group scored the highest score in school history during the semi-finals,...read more
Submit Names Now for Youth Grove Evening of Remembrance Annual Event to Honor Youth Victims of Traffic-Related Incidents this Fall
The City of Santa Clarita is now accepting names of youth ages 24 and younger who lost their lives in traffic-related incidents for inclusion in the annual Youth Grove Evening of Remembrance. The event will be hosted at 7:15 p.m. on Wednesday, September 6, 2017, at...read more
The Magazine of Santa Clarita has set a high standard for excellence in advertising for over 25 years. A family owned and operated business, The Magazine of Santa Clarita has grown with the Santa Clarita Valley since 1989 and become the #1 place to advertise locally.