Being a caregiver is one of the most difficult (and rewarding) jobs on the planet; but sometimes when it comes to strong-willed aging parents, getting them to admit they might need a caregiver is more difficult than the caregiving itself. Take the story of David Solie, published recently in the Los Angeles Times; “David Solie thought he was being a good son and a competent manager. But his strong-willed mother was having none of it.”

According to the article, Mr. Solie (who “had cared for hundreds of elderly patients as a physician’s assistant” ) and his mother did not speak for almost three years after he tried to convince her that she “should move someplace easier to navigate — an assisted living complex, perhaps.” Mr. Solie also expressed that his mother “should relinquish her role as chief caregiver to Roger [Solie’s brother], who could be placed in a group home.”

These kinds of suggestions are often very difficult for independent and strong-minded seniors to hear, and with good reason; after having taken care of themselves, their children, and in some cases taken care of their own parents as well, in their time—it’s not easy to have someone come along and say they can’t do it anymore.

The key, says Mr. Solie, is to recognize and respect a parent’s psychological needs as well as their physical limitations. Once they were on speaking terms again, Mr. Solie started “asking his mom questions about her life and listening intently to her stories. Acknowledging to his mother that there were no longer easy ways to reconcile her safety and her desire to stay put, he asked what would work for her. Then mother and son struck compromises that built a network of support around her and Roger in their home.”

The process of transitioning elderly parents from independent lifestyles they may not be able to handle anymore will be made much easier if you begin the process by asking and listening, instead of simply telling. If the ultimate goal is to increase ease and avoid frustration, shouldn’t that be the goal of each conversation along the way as well?

Divorce is difficult on a family no matter what the circumstances. Even when a divorce is best for all involved, there is always an amount of stress and emotional trauma involved. In fact, it has recently become apparent that the effects of divorce—stress, family upheaval, and tighter finances—can last years into the future. Our firm works frequently to help divorced or remarrying couples update their estate plans to protect their new blended families, and we often see how the effects divorce can continue to have even as much as 20 or 30 years down the road—not just on the couple but on their grown children now acting as caregivers.

Adult children of aging parents often find themselves caring not only for mom and dad but also for stepmom, stepdad and sometimes even another stepparent from yet a third (and current) marriage. Dividing time (and often finances) between so many parents with new and special needs can quickly take its toll, as can the family politics that come with adult siblings, half siblings, and step siblings.

With all of this complexity and intermingling family ties, it is more important than ever to have conversations about estate planning and long-term care with parents and siblings before mom and dad (and stepmom and stepdad) get to an age where they need in-home or around the clock nursing care. A good estate plan can eliminate much potential fighting and confusion by clearly defining who will be making financial decisions and who should be making health care decisions when mom or dad become incapacitated. A caregiver agreement can provide financial assistance to the one sibling who inevitably ends up shouldering most of the care giving burden.

If you are a part of a blended family don’t wait for time to take its toll; talk to your parents and siblings now about any challenges the future may bring—and how to meet those challenges together.

Most people believe that creating an estate plan is a private and personal business; something you do alone or with your spouse, between you and your attorney, with your children, grandchildren, or other beneficiaries kept on a strictly need-to-know basis. In an ideal world this would be true: parents and their adult children would always get along, and when those parents passed away their children would quietly and respectfully follow their wishes regarding the distribution of their estate.

Unfortunately, we don’t always live in an ideal world, and inheritance and estate planning can often cause tension between parents and children—sometimes before the parents have even reached retirement age! This does not have to be your family’s fate, however. Even if you suspect your children won’t like what you’ve put in your will or trust it may be possible to keep the peace and prevent family fights from breaking out—both in the here and now, and after your death.

Some people choose to simply keep their wishes secreted away in a safety deposit box when they know their family members will disapprove of the contents, and then let everyone fight it out on their own after the grantor has passed away; but this only puts off the bad feelings and can often cause lasting rifts among siblings at a time when they most need the love and support of family. Furthermore, this strategy of secrecy doesn’t address what happens if you become incapacitated and need one of your trustees or agents (in all likelihood one of your children) to take over your affairs.

A better option than secrecy is to invite your children to join you in a meeting with your estate planning attorney. This gives you an opportunity to share your plans in the presence of a knowledgeable professional who is on your side; it also gives your children the chance to ask questions and get clear and immediate answers. More often than not tension about mom and dad’s estate plan stems from a lack of understanding, or a worry that mom or dad have been taken advantage of. Having a family meeting with your attorney can be reassuring, educational, and put everyone one the same page moving into the future.

President Obama, in his Presidential Proclamation of National Family Caregivers Month – November 2011 – states;

“Across our country, millions of family members, neighbors, and friends provide care and support for their loved ones during times of need.  With profound compassion and selflessness, these caregivers sustain American men, women, and children at their most vulnerable moments, and through their devoted acts, they exemplify the best of the American spirit.”

Statistics from the Administration On Aging show that the population 65 and older is expected to grow from its current 13%  to 19% of the total population by 2030.  With the older population increasing, the need for elder caregiving will continue to increase.  Family caregivers play a vital role in filling these caregiving needs.  Who better than family can understand the needs and ensure the best care of their loved ones….read the entire article by going to the link below

Please go to the following URL for the entire article and previous articles: Either click on the link   http://www.planforcare.org or copy and paste the following into your browser:      http://www.planforcare.org

There is good news today for senior citizens! According to this article in CNN Money, “Social Security recipients will receive a cost of living adjustment of 3.6% starting in January.” This will be the first “raise” recipients have seen in three years, and most welcome the increase. “Many seniors have felt squeezed since banks are paying virtually no interest on savings accounts and stock market declines has eroded their retirement accounts.”

Unfortunately, many seniors may not see a useful increase in their social security income thanks to a hike in Medicare premiums expected to be announced next month. “For the past two years when Social Security benefits stayed the same, many seniors were shielded from the increase in Medicare premiums because of a “hold harmless” provision that protects more than 70% of beneficiaries… However, high-income beneficiaries and new enrollees did see their benefits reduced because they are not covered under the provision.”

Even with the expected increase to Medicare premiums, most seniors are simply glad to see evidence that The-Powers-That-Be recognize the rising cost of living. While most recipients of Social Security do have an alternate form of income, with their SS benefits representing “about 41% of the elderly’s income”; there are some who “rely on the monthly checks for 90% of their income.”

For more complete information about the coming changes in Social Security please read the full article. For help understanding how this change may fit in with your other benefits, or may affect your estate planning, please contact our office.

It is common knowledge in our society of aging Baby Boomers that many adult children end up taking months or even years off from their lives and careers to provide care for their elderly parents. Most children do this out of love and a sense of duty, but even in the closest of parent-child relationships there may be an unspoken expectation that appreciation for the caregiving child’s time and effort may be reflected in the parent’s will or trust. After all, professional caregivers demand a salary, is it too much to expect that a relative serving as caregiver should be compensated as well?

Take as an example the case of Anthony Olivo, who this article in Forbes describes as “a tax lawyer who ended up providing nearly full-time care for his mother and father.” Anthony “worked in law firms from 1976 to 1988 and then opened his own practice. Yet by 1994, given all the time he was devoting to his parents and their health problems, he found it hard to maintain his practice. He lived with his parents and gave them round-the-clock care from 1994 through 2003, during which he earned no significant income from his law practice.”

Now Mr. Olivo is asking that the U.S. Tax Court deduct $1.24 million from the estate of his parents for fees it paid to Anthony while he was serving as caregiver. Mr. Olivo is not challenging his parents’ wishes, he is not asking for more of the estate than his parents bequeathed to him; rather, he is asking that a “salary” for caregiving be deducted from the taxable portion of his inheritance.

Unfortunately, in the absence of a legal agreement, the tax court is unable to rule in Mr. Olivo’s favor: “The court was careful to note that Anthony rendered extraordinary care and that his efforts were commendable. However, the court ruled that his mother’s estate did not establish that Anthony was entitled to that pay. There were no written agreements and scant evidence the family agreed to pay him.” Furthermore, “There was no contract and no firm evidence of how much Anthony’s services were worth.”

We sympathize with Mr. Olivo, and hope that our firm can help save our clients from ending up in a similar situation. Simply leaving the caregiving relative “a little extra” in a will or trust is not enough, we cannot stress enough the importance of a legal caregiver agreement if a family member is providing caregiver services—especially if that family member is giving up time from his or her own career to do so.

Trudy Lieberman has had plenty of experience with Medicare—of course up until now most of it was from the outside looking in. As a journalist for more than 40 years specializing in insurance, health care, health care financing and long-term care, one would think that when the time came this year for her to enter the Medicare system herself she’d be an old pro. Unfortunately, as Ms. Lieberman discovered—and shared with the readers of her exceptional five part article series in Time Magazine’s Moneyland—entering the Medicare system as a patient can be confusing for even the most knowledgeable of inside reporters.

While her experience as a reporter may not have made signing up for Medicare any easier for Ms. Lieberman, her willingness to share her entrance into Medicare with readers may make the process easier for the rest of us. Here are just a few of the issues Lieberman has written about thus far:

Sorting through Medicare information and choosing a plan: “Brochures and ‘lead cards’ for Medicare Advantage plans and Medigap policies began flooding my mailbox in January. This stuff can be a real burden, but some of it’s worthwhile – some even important – so you can’t just throw it all away…Hopefully, my sorting system (partly informed by decades of reporting on Medicare, partly by common sense) will make the task easier for you.

Choosing a Medigap Plan to fill in the gaps of Medicare coverage: “It quickly became clear that the push to give consumers more choices and more information has actually made the job of picking a Medigap plan much harder. I ended up having to check out multiple websites, brochures, handouts and make several toll-free calls for assistance.”

Finding a plan to cover the cost of prescription drugs: “I decided to ask my pharmacy about the retail cost of the drugs I currently take. I’ve always had great drug coverage, so it was shocking to learn that my prescriptions would cost $3,131 a year if I had to pay out-of-pocket. (Of course, from interviewing seniors over the years, I know some folks actually pay four or five times that amount.)”

We know how confusing and time consuming dealing with Medicare can be, so it’s helpful to know that many elder law attorneys specialize in helping seniors with this very process—we can help you too.

Recently, an all too familiar situation arose again. A client called to say he received his first $1,644 monthly check from the Veterans Administration. He told me this was going to make a big difference in his life. Last year he fell and broke his hip and had to move in with his son and daughter-in-law. The client could no longer live on his own without assistance, but his family is happy to help.

This client contacted our office after being told he did not qualify for VA pension (aid and attendance) benefits.  The person who communicated this to the client said that because he “had not been injured in the war, he was not eligible.” They also said that his income was “just too high.”  Even the VA’s own representatives are sometimes unclear about who qualifies for this underused benefit that gives monthly cash payments to qualified vets.  The person who spoke to this client did not know that all World War II, Korean War and Vietnam veterans are entitled up to $1,644 per month ($1,949 a month if the vet is married) if their doctor says that they need daily assistance for their care. There is no requirement that the veteran be injured while on duty, or even to have served in the war theater.

The VA will also pay a relative to provide this daily in home care (when done properly with the assistance of a VA accredited attorney). The VA will also help pay for assisted living facilities. Often, if a senior combines his Social Security benefits, plus these VA benefits, they can pay for a much nicer assisted living facility than they would be able to pay for on their Social Security alone. Or, be able to afford in-home care and stay at home.

Widows of veterans may also be eligible for up to $1,056 per month to cover similar healthcare expenses. This is only if they did not divorce the veteran, or remarry, and if they remarried their second husband was also a qualified veteran.

In regards to the income limits, many people don’t understand that the veteran’s medical expenses (including a caregiver’s cost, insurance premiums, medical supplies, etc..) are deductible from the vet’s stated income on the benefit application.  So once you deduct the medical expenses from the regular income, many vets do actually qualify.

Here is just a partial list of incorrect statements that have been made in connection with the aid and attendance pension benefit offered by the US government:

• You can’t get VA benefits because you were not injured in combat;
• You can’t get VA benefits because you did not serve overseas;
• You can’t get VA benefits because your assets are too high;
• You can’t get VA benefits because your income is too high;
• You can’t get VA benefits because you are only a widow of a veteran;
• You can’t get VA benefits because you only served in the Merchant Marines;
• You can’t get VA benefits because you only served in the Coast Guard.

I am a VA accredited attorney and I can practice before the Veterans Administration. I am a member of the Academy of VA Pension Planners and work closely with Jim Swain, a nationally recognized expert on VA Pension and Estate Planning.  I can give legal advice regarding how to qualify you for benefits, which may also include the use of estate planning tools (living trusts, irrevocable trusts, gifts, etc..) to help qualify you for your VA pension benefit.  It would take hundreds of thousands of dollars in the bank earning interest to equal these cash income payments available to qualified Vets through the VA Pension program. Be sure you have all the facts on this valuable benefit.

If you call our office we can connect you to one of our case managers who will review the benefits and interview you to determine whether you qualify for the pension benefit, and how much you are entitled to receive. This is a free call.  There is no risk and no obligation. Let us see if you have benefits that you are not taking advantage of, after all – you earned them!

Call Shawn McCammon, local attorney and principal of Liberty Law, APC., at the Redding (530.246.1152) or Red Bluff office (530.529.4329) to get your free evaluation started today! Every day you wait could be money lost.

Estate planning is often about how people can pass wealth on to their children or grandchildren, but what if a child wants to give financial gifts to a parent or grandparent? This article from Bloomberg discusses just that: how GRATs Let Children Pass Millions to Mom or Granny Free of U.S. Gift Taxes.

As the elderly population of the U.S. increases, and as the effects of the economic downturn hit, more and more adult children find that their parents or grandparents are not doing as well financially as they had hoped. Many need help paying for medical expenses, home care expenses, mortgage or rent payments, etc. Adult children would like to be able to help, and a properly executed GRAT can be the perfect vehicle for wealthy children to give financial aid to their parents or grandparents without taking away from their lifetime gift-tax exemptions.

“With a GRAT, a child sets up a trust with a term of at least two years and funds the trust with stock or other investments. The trust pays the principal plus interest back to the child over its term as if it were an annuity, based on an interest rate set by the Internal Revenue Service. Any appreciation of the underlying investments above this ‘hurdle’ rate passes on to the GRAT’s beneficiary, in this case the parents, without being considered a gift for tax purposes.”

However, this opportunity may not be around forever. The Obama administration has recommended imposing a 10 year minimum term on GRATs, an act which would make the GRAT strategy significantly less useful for many families. Adult children who would like to use a GRAT to pass wealth up to their parents or grandparents should consult with a financial or estate planning advisor sooner rather than later.

If you do miss out on the GRAT window, however, there are other options for helping elderly relatives, including paying medical expenses for the loved one (so long as payments are made to the service provider directly, rather than to the relative.) Contact our office for other options and more information about helping elderly parents and grandparents.

Can you remember what you were doing in your early 20s? Can you imagine what kind of life you’ll be living in your 70s or 80s? We experience incredible changes as the decades roll by—not just to ourselves, but in the world at large. With our lives changing so much, our estate planning documents and strategies should hardly remain static. Here is a guide to how your estate plan may or may not evolve through the decades.

In Your 20s: You’re young, just finishing school and starting in your career, unlikely to be married yet… the last thing you’re thinking about is estate planning! At this time of life, who gets your “stuff” may not be as important as who will make your decisions. Choosing your financial and healthcare agents and creating your power of attorney and healthcare directive are the important things to do at this time.

In Your 30s: Marriage, children, home ownership—most of these things happen in your 30s, and your estate plan should reflect that. Now is the time to choose guardians for your young children, decide with your spouse how your joint property will be distributed, and get serious about life insurance.

In Your 40s: This is when your strategy may switch from simple direction of inheritance to more serious asset protection. You’ve worked hard and saved, and you’ll want to think about the best way to maximize your assets with trusts and tax planning.

In Your 50s: As your children start to become independent you may have more freedom with your income. Some people choose to create charitable trusts, some prefer to invest for retirement, and still others decide it’s time to take a risk and start over with a second career. Your estate planner can advise and help with all of these.

In Your 60s: Ah retirement! Making the big change from work to retirement means making changes to your estate plan as well. If you’ve been keeping up with your planning through the decades all that is required now will be some basic maintenance; changes to account for marriages of your children, the birth of grandchildren, and your own relocation to someplace warm and sunny. But beyond the basic maintenance, you may want to start doing some simple Medicaid and long-term care planning—just in case.

In your 70s and Beyond: Health is the key word now. Our life-spans are getting longer, but so are our illnesses, you need to be ready. Tighten up your estate plan, invest in long-term care insurance, and although it may sound morbid, talk to your doctors and family about your end-of-life decisions.

The life alterations that come over a span of decades are difficult enough; you don’t want to have to find a new lawyer every time your circumstances change. Our firm makes it our business to keep up with you at every stage.