Klitzman Law Group, PLLC

Estate Planning Challenges for a Really Long Life

Increasingly wealthy people are paying for medical services that could potentially help them live for over a century. That creates estate planning challenges that did not exist for previous generations of the ultra-wealthy.

No one can guarantee that they will live a longer than normal life, no matter how much money they have to spend on their health care. However, medical advances and new personalized medical care plans, such as concierge care, make it so that those with enough means can make it far more likely than ever that they will live much longer than their peers.

This could mean that in the near future it will be common for the ultra-wealthy to live for 100 years and even decades longer, in some cases. This will have some benefits, but it also comes with some unique estate planning challenges.

Forbes recently discussed some of the challenges in "Estate Planning For The Ultra-Wealthy When Living To 120 Or Beyond."

The biggest issue is that it is common for people to retain control of their own assets until they pass away. That can become a problem the longer people live. Scientists still do not have a cure for dementia and the longer people live, the more likely they are to suffer from it.

A long life of carefully managing money could easily be undone. Younger family members might also start to grow impatient waiting to take control and cause problems.

The ultra-wealthy who plan to live long lives, might want to consider an estate plan that gives control to someone else before they pass away. At what age should that be done and under what circumstances, are matters these families should discuss.

Reference: Forbes (Jan. 18, 2017) "Estate Planning For The Ultra-Wealthy When Living To 120 Or Beyond."

Suggested Key Words: Estate Planning

 

Support for Aid in Dying on the Increase

For a long time, a majority of Americans have believed that a person has the right to choose when they want to pass away and to have a physician's assistance in death. However, few people actually did have that right. That is beginning to change.

The U.S. has come a long way since the days when Dr. Jack Kevorkian was prosecuted for assisting terminally ill patients commit suicide. At that time, he was popularly viewed as a monster in the media.

He, however, may have ultimately won the war.

Americans have gradually come around to the view that terminally ill people have the right to end their lives when they want to and under the circumstances they choose. For some time now, polls have consistently suggested that more than 60% of Americans believe a physician should be able to help a willing terminally ill patient pass away.

Laws allowing it, have been much slower to pass.

20% of Americans will soon be living in states that allow the practice, as The New York Times reports in "Physician Aid in Dying Gains Acceptance."

Given the popularity of the idea, it seems likely that even more states will soon allow the practice. That raises new challenges for the elderly, their families and for elder law advocates.

Families will need to consider things previously unconsidered, such as when it is appropriate for a family member to choose to pass away.

Advocates will need to make sure that laws and regulations are designed with appropriate protections for patients and doctors.

Reference: New York Times (Jan. 16, 2017) "Physician Aid in Dying Gains Acceptance."

Suggested Key Words: Elder Law

 

Changing Residence and Your Estate Plan

Every year thousands of wealthy people temporarily move from their cold, northern homes to residences in warmer states. Many consider making their warmer homes their permanent residence, especially as they grow older.

Given the choice, many people would much rather live in the warm, sunny climates of states such as Florida and Arizona instead of the colder climates of northern states. However, for most people, that is not an option since they have good jobs they cannot leave in northern states.

Some of them, however, are able to maintain residences in warmer states where they can live during the winter. As they near retirement, many consider switching residences completely and making their southern home their permanent home.

This is reported by the Middletown Transcript in "MAKING CENTS: From snowbird to flamingo."

What many people do not realize is that if they change their state of residence, then they may also need to change their estate plans.

An estate plan crafted by an expert estate planning attorney is created with your individual state of residence in mind and making sure that state laws are followed. The estate plans are designed to work for the individual states. That means they may need to be changed to reflect the laws of a new state of residence.

If you do move to Florida or Arizona, or any other state, make sure to see a local estate planning attorney so your estate plan can be changed to take advantage of your new state's laws.

Reference: Middletown Transcript (Jan. 17, 2017) "MAKING CENTS: From snowbird to flamingo."

Suggested Key Words: Estate Planning

Student Loan Debt Is an Elder Law Issue

Student loans are often thought to be an issue for younger people, but data suggests that they are increasingly becoming an issue for senior citizens.

In recent decades, the costs of getting a college education have skyrocketed at a rate that far surpasses the general rate of inflation. This has caused more and more students to take out student loans.

After graduation these students start their careers with large debts that sometimes are in the six figures, especially if they received post-graduate degrees. This issue has started to attract the attention of many politicians who have tried to figure out how to make college more affordable and how to make it easier for people to pay off their student loans.

Many people assume that these politicians are merely paying attention in order to attract younger generations to vote for them. However, data compiled by the Consumer Financial Protection Bureau suggests that student loan debt is also an elder law issue, according to Financial Advisor in "Student Loan Debts Plague Older Americans."

In 2015, 2.8 million people age 60 or over had student loan debts. The majority of them took out the loans for children or grandchildren, but 27% had student loan debts from their own educations.

A total of 37% of people with student loan debt over the age of 65 were in default, which means that their Social Security payments can be reduced, their tax refunds can be taken and their wages can be garnished.

This is a particular problem for people on Social Security since the program is designed to eliminate elder poverty.

If the payments are reduced to pay back the government for student loans, then the poverty reduction benefits of the program are also reduced.

Reference: Financial Advisor (Jan. 16, 2017) "Student Loan Debts Plague Older Americans."

Suggested Key Words: Elder Law, Social Security

Millennials Should Pay Attention to Elder Law

The Millennial generation might still have a long way to go before they reach retirement age, but they should be paying attention to elder law issues that will affect them in the future.

People of all generations tend to pay the most attention to the issues that affect them directly and immediately.

Most senior citizens do not think a lot about the cost of a college education and the availability of entry level jobs. Conversely, younger people do not think much about Social Security and Medicare. Each group has more pressing concerns that hold their attention.

However, the younger Millennial generation should pay attention to Social Security and Medicare.

Some people believe that stock markets will be bearish in the next few years.  As a result, Millennials should save 25% of their current income to make sure that their retirement nest eggs grow at the appropriate rate, according to Wealth Management in "Should Millennials Double Retirement Savings Rates?"

Many Millennials will quickly point out that due to other economic factors beyond their control, they cannot afford to save 25% of their incomes, or even the traditional 10-15%.

As a result, people in that age group will be reliant to some extent on Social Security and Medicare when they retire. Since both of those programs face impending financial problems, Millennials need to pay attention to how these programs might change.

They should not consider it just an issue for older people. It will be their issue one day.

Reference: Wealth Management (Jan. 11, 2017) "Ken Thompson's mother says she was cut out of will by late Brooklyn DA's wife."

Suggested Key Words: Elder Law, Social Security, Medicare

The Future of Medicare

President-elect Donald Trump's nominee to be Secretary of Health and Human Services has many worried that Medicare could undergo severe changes and cuts. However, there might be some opportunity for positive changes as well.

It is no secret that U.S. Rep. Tom Price is not a fan of Medicare or any form of federal government health coverage. Since he has been in Congress, the legislator has sought to make drastic changes to Medicare and to reduce its funding. This has many seniors and elder law advocates rightfully worried.

If he is confirmed as the next Secretary of Health and Human Services, the future of Medicare is in doubt, as Price would be in charge of overseeing the program.

However, as NJ.com recently argued in "Make lemonade out of possible Medicare lemon," there might be an opportunity for positive changes to the program.

One thing Price might do as secretary is to end Medicare at the federal level and instead give each state a block grant to administer its own replacement program. That could leave open the possibility that individual states could seek to negotiate prescription drug prices with manufacturers, which the federal government is currently prohibited from doing.

While negotiating at the state level would not be as effective at lowering prices as it would be at the federal level, it would still be helpful and Medicare patients could see their drug prices reduced.

Reference: NJ.com (Dec. 26, 2016) "Make lemonade out of possible Medicare lemon."

Suggested Key Words: Elder Law, Medicare