On the surface estate planning may seen like a pretty cut and dried matter. You make an appointment and spend some time with an estate planning lawyer, draw up a will or a trust, and that’s it, end of story.  This can can be the way you go about it, but if you want to be sure that you are truly prepared for all of the eventualities of aging, you would do well to take a more comprehensive approach.

Ii is human nature to assume that the state of consciousness that you are in at any given time will persist throughout your life.  So when you visualize the end of your life and the period preceding the distribution of your estate, all you can do is expect that you will feel more or less as you do right now mentally up until the time you pass away.  Unfortunately the statistics tell a different story, as hard as it may be to accept.

Just about everyone has heard of Alzheimer’s disease, but unless you have a family member who has contracted it or you happen to have done a considerable amount of research, you probably don’t know just how widespread this affliction has become.  It is estimated that one out of every eight senior citizens has Alzheimer’s disease.  Some 50% of those who reach the age of 85 are Alzheimer’s sufferers.  Clearly Alzheimer’s disease is a ubiquitous problem by any logical barometer and it would seem as though it is going to get worse before it gets better given the rapid expansion of the elder population.

Alzheimer’s disease causes dementia, and among other things dementia limits one’s ability to analyze data and make sound decisions.  Preparing for the possibility of Alzheimer’s disease impairing your decision-making abilities makes incapacity planning a necessity.  Unless you have already addressed this contingency it may be a good idea to consult with an elder law attorney and do what is necessary to protect yourself and your family from the challenges that Alzheimer’s disease can present.

Frank & Kraft, Attorneys at Law is a member of the American Academy of Estate Planning Attorneys.

Estate planning is usually seen as something that involves the distribution of your assets after your death, and rightly so.  But the totality of the matter blends into the period of your life that precedes your passing.  Why is this?  To put it bluntly, if you don’t have anything left when you die any planning that you may have done regarding inheritances is not going to have a whole lot of value.

Obviously there are those who have sufficient assets to easily handle any and all eventualities that may come their way and sill have more than enough resources to leave a poignant legacy. But a lot of people fall into a gray area where they may or may not have significant assets to pass on to their loved ones depending on various contingencies.  One of the things that people who fit into this category would do well to consider is the cost of long term care.

The facts would indicate that it is quite possible that you may be spending some time in a nursing home or assisted living facility; about half of all seniors will reside in a nursing home at some point in time.  The average stay is about two and a half years.

Now let’s take a look at the costs associated with long term care.  According to the annual MetLife market research study, the average annual cost for a year in a private room in a nursing home in 2009 was $79,935.  That number rose in 2010 by 4.6% to $83,585. The costs associated with residing in an assisted living facility rose at an even higher rate of 5.2%, from an average of $37,572 in 2009 up to $39,516.

These numbers are high, they are on the rise, and industry experts expect this upward trending to continue.  Planning is key, so when you are budgeting for the future take these costs into consideration and act accordingly.

Frank & Kraft, Attorneys at Law is a member of the American Academy of Estate Planning Attorneys.

When you decide to do some research into estate planning you will invariably see a number of legal instruments referred to that you may not be entirely familiar with. Advance health care directives can fall into this category for many people, so we would like to provide a brief overview to give you an idea of what these vehicles are intended to achieve and why they are important.

The most commonly used advance health care directives are the living will and the durable medical power of attorney or health care proxy. People are living longer than ever, and these expanding lifespans increase the possibility of a period of incapacity at some point. And of course people of all ages can become incapacitated as a result of an accident or due to a sudden and unexpected illness. Advance health care directives are documents that you can use to state your wishes with regard to medical matters in advance should you become unable to communicate them.

With a living will you can directly communicate the types of medical procedures you would be willing to accept and those that you would prefer to deny in the event of your incapacitation. The core issue in most living wills is the matter of being kept alive through the use of artificial life support systems when there is no hope for recovery.

The durable medical power of attorney is used to select someone that you empower to make health care decisions in your behalf should you become unable to make them for yourself due to incapacity. The reason why many people execute both of these advance health care directives is because it can be difficult to address every possible medical contingency in a living will. When you name a health care proxy, he or she can act in your behalf in situations that may not be covered in the living will.

Frank & Kraft, Attorneys at Law is a member of the American Academy of Estate Planning Attorneys.

One of the top stories in the elder law community of late has been the rising cost of long term care. This is a very complex matter because the playing field is changing as the costs are rising, and there are no easy answers. Let’s start by recapping the costs associated with long term care, which we have touched on previously in this space.

According to a MetLife market survey, in 2010 the national average charge for a day in a private room in a nursing home was $229; this factors out to over $83,500 per year, which represents a 4.8% increase over 2009 numbers. In the state of New Jersey the average is into the six figures.

The cost of a year in an assisted living facility rose by even more. In 2009 the charge for a year’s stay in an assisted living facility averaged $37,572 in the United States. In 2010 it was $39,516, and that is a 5.2% increase. Once again, these numbers are larger in the Garden State, where a year in an assisted living facility would set you back over $54,000 on average.

These costs are attention-getting at present, but if they continue to rise at about five percent every year for the next five, ten, or twenty years they may be truly suffocating by the time you need long term care. This is a challenge that can be addressed by the purchase of long term care insurance.

Long term care insurance is expensive in its own right, but you can get locked in at a lower rate if you obtain the coverage when you are in your forties or fifties. A person who is fifty-years-old may pay about $150 a month for coverage, while a sixty-year-old may be looking at a $250 monthly payment (these are broad estimates).

The suggestion here is to do some research on the matter and compare some quotes if you find that long term care insurance sounds like a viable solution given the specifics of your financial situation. The longer you wait before purchasing the coverage the more expensive it will be, and coverage is not going to be offered at all once you reach an advanced age.

Frank & Kraft, Attorneys at Law is a member of the American Academy of Estate Planning Attorneys.

Leaving a loved one in the care of others is not an easy decision to make. The best-case scenario would be for a relative or close friend care for them. As this is not always possible due to schedules and the complicated medical care needed, you may have to trust nursing home staff to oversee care of your family member. This can be a nerve-wrecking and frightening decision, but there are some things you can do to ease your mind and ensure that your loved one is receiving optimal care.

Make Frequent, Unscheduled Visits

In the beginning, it is assumed you will make quite a few visits to the facility to bring in clothes and a few personal items. After the initial week or so, staff may ask when you, members of your family or friends may usually visit, this is used to help them anticipate when they should have your loved one available, and not involved in an activity or napping. While that knowledge is helpful to the facility staff, the unexpected visit can sometimes tell you more about the way the facility is run and what the “normal” for the facility is.

Monitor Your Loved One’s Eating Habits

After every meal the amount of food consumed as well as fluid intake for each facility patient is recorded in a book at the nurses’ station. This knowledge can be shared with family members. The bathroom habits of patients are also recorded. Should your loved one’s eating habits changed or they are not regularly using the bathroom, ask the nursing staff for assistance. Medications sometimes decrease appetites and change elimination patterns.

Lock Up Valuables

While no one should enter a nursing facility with valuables, it is customary to wear wedding rings or gold necklaces. Other small valuables such a MP3 players, Cds and small amounts of money can usually be locked up in a secured drawer in your loved one’s room. A portable lock box is not recommended.

Label Everything

Label everything in a permanent marker, right down to the socks with your loved one’s name. Most often the facility will perform housekeeping duties, including laundry. All clothing, including underwear, should be labeled with a laundry marker. Also make sure shoes are labeled. Accidental mix-ups are common and labels make it easier for the staff to locate your loved one’s belongings.

Ask Questions

The more questions you ask, the more the facility understands that you are actively involved in the care of your loved one. If you see anything you do not understand, speak up. Go to the nurses directly involved in your loved one’s care. Ask for the social worker to sit down with you and other family member. Facilities will understand your loved one’s needs better if you allow them the opportunity to meet them.

Frank & Kraft, Attorneys at Law is a member of the American Academy of Estate Planning Attorneys.

Guardianship is a legal proceeding by which a person petitions the Court to allow the petitioner to assume control over the physical person or property of another person. Guardianship can occur in several circumstances:

• Injury or illness of an adult that leaves the adult unable to care for themselves or their property
• Minor Children who do not have a parent to care for them
• Mentally disabled persons who are at risk of being taken advantage by designing persons
• Older adults suffering from dementia or Alzheimer’s

The need for guardianship over a younger adult will usually occur if that person has suffered illness or injury, which reduces their ability to care for their physical needs or handle their property. Guardianship is usually awarded by the court to a family member concerned about the individual subject to guardianship.

If you have young children you should consider who you would want to have guardianship over your child is something should happen to you that would prevent you from raising your child. Consider also that the person you would want to have guardianship over the person of your child, the one responsible for the child’s upbringing, may not be the same person who would have guardianship over any property or money you would leave for a child. Parents of a mentally or physically disabled child also need to consider guardianship issues in their estate planning.

Most people are familiar with the situation where an elderly parent or other family member may need guardianship because of Alzheimer’s or some other form of dementia or physical incapacity. Guardianship may be avoidable in this circumstance if a durable power of attorney is executed when the person is competent.

There are also instances in which the state has to take guardianship over a person and their property, through such agencies as the Office of the Public Guardian, or the state’s Office on Aging. Public guardianships can occur if the subject of the guardianship has no relatives to care for them or if such relatives have been removed from guardianship by abusing their position as guardian.

Frank & Kraft, Attorneys at Law is a member of the American Academy of Estate Planning Attorneys.

People are living longer, which means more may face mentally debilitating diseases such as Alzheimer’s or other long term illnesses. These people may no longer be able to make their own medical decisions. So, how are decisions made? If there are no disability planning documents, a court will name a guardian to make all decisions for that person. Having someone else make all of your decisions may seem scary. If so, you should use a Living Will along with other disability planning documents.　

State Your Preferences
You should use a Living Will if you have specific desires regarding your medical care and treatment. Do you prefer not to be put on a respirator? Or maybe you don’t want to face life-prolonging surgery if you have been diagnosed with a terminal illness. If you do have preferences about life-prolonging procedures, you should use a Living Will to state your desires.

Many Living Wills focus on both life-prolonging and palliative treatments. Life-prolonging treatments are those that extend a life when a diagnosis of terminal illness or injury has been issued. Palliative treatment is pain relief methods used to alleviate pain from a terminal illness or injury. Hospice care often focuses on palliative treatment when a patient has decided to forego life-prolonging treatments.　

Assist Health Care Agent
By stating your medical wishes in your Living Will, you can assist your health care agent or court-supervised guardian. If you have a Medical Power of Attorney, you can name a health care agent to make medical decisions for you. He or she can use your Living Will as guidance. If you have not named a health care agent, a court-appointed guardian will make your medical choices. He or she can also use your Living Will as a blueprint. It is best, however, to also name a health care agent and so you can go over your Living Will with that person in advance.

Frank & Kraft, Attorneys at Law is a member of the American Academy of Estate Planning Attorneys.

Many women that are now retired or will retire soon are not prepared, especially when it comes to paying for any long-term care that they might need. Studies have shown that one of the main reasons why a lot of women are not prepared for retirement is the belief system they were exposed to early in life.

In one study about half of the women surveyed were brought up to believe that a man would care for their financial needs throughout their lives, but only about 3% of women now believe this. About 97% of women now believe that they have been given no choice but to take control of their own financial situation.

Obviously one of the lessons here is that for women to have financial security, they must be financially independent. Unfortunately many of the women that are getting ready to retire did not learn this until later in life because of what they were raised to believe. The result is that a lot of retired women will have a much lower standard of living than men, and most will not be prepared to pay for any long term care that they need.

The good news is that it is never too late to start preparing for the possibility that you may need long term care in the future.

• Reduce your risk for chronic illness. Find out as much as you can about your family’s medical history and if there is a particular illness or disease that you are at risk for, take measures to reduce your risk now.
• Will your house be adequate if your needs change? One of the main problems that you may face later is that the house you live in won’t be adequate if your needs change. For example, if you have a lot of stairs that you’ll need to climb, this could be a problem later. It is best to have your bedroom, bathroom, and all other areas of the house you’ll need access to on a regular basis, on the same level.
• What community services are available? It is important to take advantage of the services that your community has available for the elderly, such as transportation. Getting around once you are older won’t be as easy as it is now, so you’ll want to ensure that you have a means of transportation to doctor appointments, the grocery store, and important activities.
• Talk with your family. Communicating with your family is important; you’ll want to talk with them about what your wishes are as far as medical care when the time comes that they must make these decisions.
• Take stock of your financial situation. The one thing you’ll want to do is see where you sit financially right now and what you can do to improve your financial situation in the future. Find out what you need to know about long term care, such as what is available and the cost. Think about ways that you might be able to pay for this care, such as long term care insurance, or estate planning that would help you quality for Medicaid.

When it comes to retirement and long term care, the most dangerous thing you can do is to ignore the problem. If you face it now and do what you can to prepare, you and your family will be in a much better position in the future.

Frank & Kraft, Attorneys at Law is a member of the American Academy of Estate Planning Attorneys.

If you want to provide for a disabled child or adult, you might want to consider a special needs trust, also called a supplemental needs trust.

A special needs trust gives a disabled or incapacitated person the little “extras” in life without endangering their public assistance benefits such as food stamps, Medicaid, or Supplemental Security Income “SSI.”

Such trusts can allow for education, travel, and home care above what is provided by public benefits, etc.

• –the recipient be less than 65 years old at the time the trust is established
• –the trust be irrevocable
• –the trust must be set up by a parent, grandparent, guardian, or the court (if the trust is a pooled special needs trust, the trust can be set up by the disabled person)
• –trustee must have absolute discretion over the funds; no direct payments to the disabled recipient
• –if a pooled trust, at the death of the disabled person, the trust can retain a portion of any remaining funds to benefit other beneficiaries of the pooled trust.

Special Needs Trusts Funded by Those Other Than the Disabled Person.

This type of trust does not need to reimburse the state for Medicaid costs at the death of the disabled person.

Other features include

• –the trust can be revocable by settlor
• –can be established after disabled person turns 65
• –any remaining funds can go to other family members if disabled person passes away

Please contact your Estate Planning Attorney who can help you establish a Special Needs Trust for your loved ones.

Frank & Kraft, Attorneys at Law is a member of the American Academy of Estate Planning Attorneys.

If you are concerned about a family member being able to care for themselves, you might want to consider guardianship. A guardian can be appointed for persons who cannot provide self care or manage their finances, who have dementia, or are otherwise incapacitated mentally or physically. Those who are habitually drunk or abuse drugs or have a developmental disability can also be considered incapacitated for guardianship purposes.

There are three kinds of guardianships:

• Guardian of the person—oversees living conditions, education, and medical services and treatment of the protected person (person with a guardian). A guardian of the person must be a natural person, not a corporation.
• Guardian of the estate—oversees the financial and investment affairs.
• Guardian of the person and the estate—oversees both the person and the estate (in many cases, one person serves as both kinds of guardians).

A guardianship can either be voluntary or involuntary, temporary or permanent. A voluntary guardianship is at the request of the ward or protected person, whereas an involuntary guardianship is at the request of family or friends of the protected person. A temporary or emergency guardianship can be court ordered, without a hearing, but can last no more than 60 days. A permanent guardianship lasts as long as necessary, but there must be a hearing first. Guardianships can also be limited, with guardians only having limited power. If not limited, the protected person has no legal capacity and must act legally through the guardian.

Among the issues to be decided at the guardianship hearing are—

• Can the person truly not care for themselves or manage their finances?
• Who would be the best guardian for the job?
• Who are the people who should spend time with the protected person?
• What decisions can the protected person make on their own?

Frank & Kraft, Attorneys at Law is a member of the American Academy of Estate Planning Attorneys.