Let's face it... in today's world, senior citizens and their families face more complicated financial, legal and personal planning decisions than ever before--and making the wrong decisions can be catastrophic. In this book, Steven J.J. Weisman, renowned estate planning attorney and host of the nationally syndicated radio show "A Touch of Grey," offers you practical, simple guidance on every one of these issues. Written with simplicity and humor, Elder Planning uncovers strategies and loopholes for retirement, health care, long-term care, asset protection, investments, taxes, social security, housing, Medicare/Medicaid, estate planning, substitute decision, and more. This book is easy to read and easy to use, making it the indispensable resource for anyone needing to protect themselves, their parents and their heirs.
Preface
"People do not plan to fail, they merely fail to plan."—Old Adage
There is an old adage that people do not plan to fail, they merely fail to plan. We all want financial security and control over the important areas of our lives, but the task of putting our lives in order can be quite daunting. The journey toward organizing our affairs is impossible without a roadmap. This book will help guide you on your way. Each chapter deals with an important aspect of personal legal and financial planning, and although each chapter takes you a little closer toward the goal of implementing a comprehensive legal and financial plan, you can also go right to the chapter that specifically deals with your own personal goals. I hope you enjoy the journey.
Life is damn complicated. The material found in this book (although I do not believe anyone actually lost this material) can help you or perhaps your friends or family deal with the many issues that face older Americans today. Although the title of this book is A Guide to Elder Planning, the book provides information that can be tremendously helpful to everyone, regardless of age, on topics such as IRAs, scams and income taxes.
Just who is an "older American," "Senior Citizen" or whatever euphemism people use to describe the elderly in America today? The definition seems to be changing, since aging baby boomers do not seem to fit the long-held stereotypes of what it is to be an older person. As a lawyer, I once represented a frail, elderly woman in a lawsuit brought against her by a large bank. On the day of trial, the presiding judge took me and the lawyers for the bank into his chambers to discuss the case beforethe jury trial started. I knew I had a friend in the courtroom when the judge opened the discussion by asking the bank's attorneys, "Why are you doing this to that little old lady?" With much effort and a judge interested in justice for all, a fair settlement was reached between the parties. Afterward the judge told me that over the years he had to change his definition of "old" because he kept reaching those ages that formerly had been limited to the elderly, a group in which he did not count himself. Finally, he told me, he arrived at a definition he could live with for the long haul: "Old is five years older than whatever I am."
Many senior citizens today are young and vital at heart, but their legal and financial affairs can be complex. This book deals with those complexities. It is written to show you how to make the law and financial situations work for you. There are many good laws of which people fail to take advantage because they just do not know about them. There are many opportunities in one's financial life that people also miss because they are not aware of them. This book tells you in plain language and with a little humor how to take charge and reorganize your affairs to make the law and the world of money work for you.
The story goes that W.C. Fields, the comedian of long ago, was on his death bed reading the Bible when a friend came to visit him. The friend was startled to see Fields, who was notoriously anti-religious (in his will, he left money to a school on the condition that religion never be taught there), reading such a book and commented, "Bill, what are you doing?" Fields responded, "Looking for loopholes." And that is also what this book is about. Looking for the loopholes to help you understand the complexities of the legal and financial matters that affect you and showing you how to make those laws and financial opportunities work for your benefit.
One of my many jobs over the years was teaching in the Massachusetts state prisons. During a long and boring orientation program, all the new teachers were instructed on how to complete a Disciplinary Report. Written in the guidelines presented to us and emphasized by the instructor was that we were to "not use too many unnecessary words." Had it not been late in a day that felt like it was interminable, I most likely would have inquired of the instructor as to what was the correct amount of unnecessary words to use. However, I did not. I did take those words to heart though and have tried in this book to "not use too many unnecessary words." This book is a guide that will describe the journey to a more secure life in an understandable and enjoyable way that will make it easier to achieve your goals and perhaps even make the journey a bit more pleasant—and without using too many unnecessary words.
Preface.
1. Asset Protection.
Insurance. Homeowners Insurance. Credit Reports. Dog Ownership. Valuable Personal Property. Liability Insurance. Prenuptial Agreements. History. Enforcement. Allowable Provisions. Medicaid Implications. Bank Accounts. Trusts. Safeguards for Trusts. Qualified Terminable Interest Trust. Offshore Trusts. Homestead Protection. Fraudulent Conveyances. Assets Protected by Law. Joint Ownership. Tenancy by the Entirety. Family Limited Partnerships. Establishment of the Partnership. Protection of the Partnership's Assets. Endnotes.
2. Senior Citizens and Credit.
Equal Credit Opportunity Act. Credit Reports. Credit Bureaus and Your FICO Score. Credit Report Error Correction. Credit Cards.
3.Substitute Decision Making.
Power of Attorney. Durable Power of Attorney. Terminology. Provisions. Attorney-in-Fact. You and Will Robinson. Danger, Will Robinson! Danger, Will Robinson!Danger! Oh, Will Robinson!Even More Danger! IRS Dangers. Health Care Proxy. The Law. The Trusted Ones. Free Advice (and Worth Every Penny).
4. Estate Planning.
Wills. Choosing an Executor. Erasing Battle Lines. Letting the State Decide. Doing It Yourself. Living Trusts. Deciding on a Living Revocable Trust. Choosing a Trustee. Choosing a Trust Protector. Incentive Trusts. Estate Taxes. The Credit Shelter Trust. Applying an Example. Using a Disclaimer. State Estate Taxes. Irrevocable Life Insurance Trusts. Charitable Remainder Trust. Defective Trusts. Section 529 Plans. Planning for Your Pets. POD Accounts. Second Marriages. Estate Planning for Unmarried Couples. Now That You Have a Plan.
5. Investments.
Mutual Funds. Fees and Charges. Types of Mutual Funds. Mutual Funds and Taxes. DRIPs. Certificates of Deposit. Treasuries. Taxes on Treasuries. Purchase of Treasuries. Comparison of Treasury Notes and Bills. Treasury Inflation-Indexed Securities. U.S. Savings Bonds. Annuities. Your Stock Portfolio. Dow Jones Industrial Average. What Should Be in Your Portfolio? Rules of Thumb. The Stocks Portion of Your Portfolio. Some Final Thoughts. Endnotes.
6. Income Taxes.
Marital Status. “Single” Category. “Married, Filing Jointly” Category. “Married, Filing Separately” Category. “Head of Household” Category. Parents and Children. Domestic Partners. The Over-65 Crowd. Untaxed Income. Tax Credits. Social Security Taxes. Tax Deductions. Loan Interest. “Normal” Medical Expenses. Off-Beat Medical Expenses. Home Improvement Medical Expenses. Deduction Documentation. Tax Relief as Big as a House. Reduced Exclusion. Basis for Exclusion. Now That You Have Prepared Your Taxes, What Documents Do You Keep? Some Final Words from Deep in the Heart of Taxes. Endnote.
7. Individual Retirement Accounts.
Traditional IRA. Roth IRA. Decisions, Decisions. The Different Path. Beneficiary Designation. Keeping It Current. Keeping It Handy. Keeping It in the Family. Conversion to a Roth IRA. Distribution. Withdrawal Pains. Early and Late Withdrawals. A Painless Withdrawal. Survivors. Disclaimers. Opportunities.
8. Planning for the Home.
Reverse Mortgages. FHA-Insured Reverse Mortgage. Lender-Insured Reverse Mortgage. Uninsured Reverse Mortgage. Odds and Ends. Mortgage Prepayment. Private Mortgage Insurance. Refinancing. Life Estates. Sell the Home to the Children.
9. Alternative Housing.
Retirement Communities. Continuing Care Retirement Communities. Money Matters. Contracts. Important Considerations in Evaluating a Continuing Care Retirement Community. Assisted Living. Legalities. Important Considerations in Evaluating an Assisted Living Facility. Endnote.
10. Long-Term Care.
History. Cost of Long-Term Care. Future Cost of Long-Term Care. Financing Long-Term Care. Your Home. Life Insurance. Long-Term Care Insurance. Eligibility for Long-Term Care Insurance. Choosing a Company. Agent or Independent Broker. Application Process. Length of Coverage. Waiting Period. Inflation Protection. Waiver of Premium. Home Care. Nonforfeiture. Renewability. Triggers for Benefits. Make the Kids Pay. Endnotes.
11. Social Security.
History. Eligibility and Benefit Calculations. Full Retirement Age. Early or Late Retirement. Early Retirement. Delayed Retirement. COLAs. Social Security Disability Income. Survivor's Benefits. Notch Babies. Getting a Copy of Your Record. Overpayments. Medicare and Your Application for Social Security Benefits. Endnote.
12. Medicare.
The Medicare Alphabet. History. Medicare A. Medicare B. Medicare C. Managed Care. Premiums. Enrollment. Medigap Insurance. Appeals. Endnote.
13. Medicaid.
Overview. Asset Eligibility. Transfer Penalty. Exceptions to Transfer Penalties. Consideration of Income. Protection from Spousal Impoverishment. Medicaid Planning. Just Say No. Estate Planning for the Community Spouse. Estate and Financial Planning for the Spouse in the Nursing Home. Tactics for Reducing Assets without a Medicaid Penalty, or Loopholes 101. Early Planning: Personal Care Contract. Too Late Planning: Divorce. Half-a-Loaf Giving. Trusts. Protecting the Home. Tactics for Increasing Assets to Achieve a Greater Spousal Resource Allowance, or Loopholes 102. Annuities. Estate Recovery. The Latest Information.
14. Being Patient.
Privacy and Medical Records. Access to Medical Records—by You and Others.
15. Scams.
Identity Theft. Sham Tax Forms. Phony Prizes. Slavery Reparations. IRS Impersonators. Credit Card Protection. Chain Letters. Social Security Scam. Pyramid Schemes. Cramming. Credit Repair Services. Travel Fraud. Reloading. A Final Bit of Advice.
16. End-of-Life Issues.
Health Care Proxy. Hospice Care. Organ Donation. Durable Power of Attorney. Beneficiary Designations. Monetary Needs. Wills. Planning Your Funeral. Wills to Live By.
17. Favorite Websites.
State Income Tax Deductibility Of Section 529 Plans.
Forms 241
Glossary 245
Index 255
People do not plan to fail, they merely fail to plan.
—Old Adage
There is an old adage that people do not plan to fail, they merely fail to plan. We all want financial security and control over the important areas of our lives, but the task of putting our lives in order can be quite daunting. The journey toward organizing our affairs is impossible without a roadmap. This book will help guide you on your way. Each chapter deals with an important aspect of personal legal and financial planning, and although each chapter takes you a little closer toward the goal of implementing a comprehensive legal and financial plan, you can also go right to the chapter that specifically deals with your own personal goals. I hope you enjoy the journey.
Life is damn complicated. The material found in this book (although I do not believe anyone actually lost this material) can help you or perhaps your friends or family deal with the many issues that face older Americans today. Although the title of this book is A Guide to Elder Planning, the book provides information that can be tremendously helpful to everyone, regardless of age, on topics such as IRAs, scams and income taxes.
Just who is an "older American," "Senior Citizen" or whatever euphemism people use to describe the elderly in America today? The definition seems to be changing, since aging baby boomers do not seem to fit the long-held stereotypes of what it is to be an older person. As a lawyer, I once represented a frail, elderly woman in a lawsuit brought against her by a large bank. On the day of trial, the presiding judge took me and the lawyers for the bank into his chambers to discuss the case before the jury trial started. I knew I had a friend in the courtroom when the judge opened the discussion by asking the bank's attorneys, "Why are you doing this to that little old lady?" With much effort and a judge interested in justice for all, a fair settlement was reached between the parties. Afterward the judge told me that over the years he had to change his definition of "old" because he kept reaching those ages that formerly had been limited to the elderly, a group in which he did not count himself. Finally, he told me, he arrived at a definition he could live with for the long haul: "Old is five years older than whatever I am."
Many senior citizens today are young and vital at heart, but their legal and financial affairs can be complex. This book deals with those complexities. It is written to show you how to make the law and financial situations work for you. There are many good laws of which people fail to take advantage because they just do not know about them. There are many opportunities in one's financial life that people also miss because they are not aware of them. This book tells you in plain language and with a little humor how to take charge and reorganize your affairs to make the law and the world of money work for you.
The story goes that W.C. Fields, the comedian of long ago, was on his death bed reading the Bible when a friend came to visit him. The friend was startled to see Fields, who was notoriously anti-religious (in his will, he left money to a school on the condition that religion never be taught there), reading such a book and commented, "Bill, what are you doing?" Fields responded, "Looking for loopholes." And that is also what this book is about. Looking for the loopholes to help you understand the complexities of the legal and financial matters that affect you and showing you how to make those laws and financial opportunities work for your benefit.
One of my many jobs over the years was teaching in the Massachusetts state prisons. During a long and boring orientation program, all the new teachers were instructed on how to complete a Disciplinary Report. Written in the guidelines presented to us and emphasized by the instructor was that we were to "not use too many unnecessary words." Had it not been late in a day that felt like it was interminable, I most likely would have inquired of the instructor as to what was the correct amount of unnecessary words to use. However, I did not. I did take those words to heart though and have tried in this book to "not use too many unnecessary words." This book is a guide that will describe the journey to a more secure life in an understandable and enjoyable way that will make it easier to achieve your goals and perhaps even make the journey a bit more pleasant—and without using too many unnecessary words.
Overview
Let's face it... in today's world, senior citizens and their families face more complicated financial, legal and personal planning decisions than ever before--and making the wrong decisions can be catastrophic. In this book, Steven J.J. Weisman, renowned estate planning attorney and host of the nationally syndicated radio show "A Touch of Grey," offers you practical, simple guidance on every one of these issues. Written with simplicity and humor, Elder Planning uncovers strategies and loopholes for retirement, ...