Beginning in 2025 the Estate and Gift Tax exemption for all citizens is $13.99 million dollars. In addition, a surviving spouse can also include the unused portion of their deceased spouse exemption. The new law makes the exemption “portable” between spouses. For example, if the first spouse to die uses only $2 million dollars of his exemption the surviving spouse will be able to exclude $25,220,000.00 million dollars of her estate from Federal Estate and Gift Tax.
With the average cost of Nursing Home Care in Pennsylvania now exceeding $150,000.00 per year, will my husband and I have to sell our home and spend our savings should one of us be admitted to a Nursing Home?
The purpose is to protect assets and allow individuals to qualify for Medical Assistance. Medical Assistance is a Welfare Program which helps individuals pay for the high cost of nursing home care, now in Pennsylvania averaging $482.00 per day. An individual’s assets will be protected so long as the Trust is created, and assets transferred five (5) years prior to a nursing home admission and request for Medical Assistance.
During the individual’s life, they will enjoy the use of the home and income generated by the assets in the Trust. Upon the individual’s death, the named beneficiaries, usually children, receive the accumulated principle.
Well it depends:
Full Social Security benefits are paid beginning at age 66 for those born between 1943 and 1954. Although Reduced Benefits will be paid to those as young as 62 who file for Social Security. Reduced benefits mean 7%-8% reduction for each year a person files early. Most people are advised to wait until full retirement to begin receiving benefits, and I agree. Of course there are exceptions. And it is those exceptions, I wish to discuss in this article.
What Is A Will?
A will is a writing signed at the end by a person at least eighteen (18) years of age and of sound mind wherein that person directs the distribution of property at death. The Will may also appoint guardians of the estates of minors who receive property under the Will.
Many seniors today are facing a perfect storm. Record low rates of return on their bank accounts and CD’s, raising supplemental insurance costs and ever increasing property taxes. Add to that escalating home health care, paltry pensions and insufficient savings there is no doubt that “Housing Wealth” should be considered in a comprehensive retirement plan.
On occasion I meet with parents heroically helping manage the life of an adult child struggling with mental illness. It is heart breaking to understand the physical and financial sacrifice parents give to make the life of a mentally disabled adult child better. The unconditional love for these adult children is truly wonderous.
In 1966 Clint Eastwood boosted his film career by staring in the western, The Good, The Bad and the Ugly. This western film title can be used to describe annuity investments. Annuities can be a “good” investment by helping serve the purchasers’ financial goals, but only if matched with the right person under the right circumstances. If matched with the wrong person under the wrong circumstances the annuity becomes “bad” or even “ugly”.