There are many reasons to think about estate planning for your heirs after your death. But estate planning can also address many costs that you will have before you die. One of these could be nursing home expenses.
A recent survey of a healthcare organization shows that 43% of those 65 or older will be in a nursing home for some period of time and that around 10% of those will stay there for at least 5 years. And the average annual cost of a private room is over $70,000. At an average of $192 a day, you could stay in a nice hotel and have room service! But estate planning generally won’t pay for that.
So, if the need arises, how are you going to meet these expenses for a parent or even for yourself? $70,000 is more than the average American household brings home in a year. In 2007, the average was $55,438 which has declined to $51,404 as of February of this year.
Estate planning can help defray some of the expenses. There are many ways to start to save for the possibilities now. Some may think that long-term care insurance is an answer, and it may help for younger people. But the older you get, the less of an option it becomes.
Medicare is another option, but only for short-term stays. When it comes time to pay nursing home expenses, many people are unpleasantly surprised to learn that Medicare doesn’t pay for long-term care. And Medicaid is only available if you qualify for its low-income requirements. But there is one loophole: once a patient is admitted to a facility, he or she cannot be released when their own funds run out if they can then qualify for Medicaid.
There are many complex laws and regulations that govern financing for nursing home care. The best option is to explore these and get estate planning advice before the need arises. There are options to finance nursing home care and not go broke. You just have to talk to someone who knows what they are.
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