Category - Senior Services

How Can ALTCS Help Me?

ALTCS stands for Arizona Long Term Care System and is Arizona’s branch of Medicaid. Applicants must qualify medically and financially in order to receive these benefits. If you do qualify for ALTCS this will cover the cost of acute care services, nursing home care, home and community based services, and services for developmentally disabled adults and children.

ALTCS does require quite a bit of planning. There are estate planning documents that can be put in to place before applying for ALTCS that will help increase the chances of qualifying. Each year 73% of all applicants are denied because they did not have prior proper planning.

It will take a minimum of 45 days to process the application. Many times they will come back and ask for more documentation. Before applying you must:

  • Meet the age and/or disability requirements
  • Verify citizenship status and identity
  • Verify your Social Security Number
  • Verify your marital status (if married)
  • Living in ALTCS qualified home or facility
  • Apply for all potential benefits
  • Assign your rights to health benefits to AHCCCS (Arizona Health Care Cost Containment System)
  • Pass the Pre-Admission Screening process
  • Meet the financial requirements
  • Have no transfer of assets in the past 5 years that would disqualify you for long term care

There is some pre-planning involved when applying for ALTCS. It would be best to meet with a consultant to give you guidance for your specific situation. Many who try to do this on their own are unaware of some of the penalties that could exist if their estate was managed incorrectly.

Visiting Your Parents for the Holidays

The holidays are a perfect time to assess how your parent’s well being has been. During your visit there are a few things you should do.

1. Conversations. Having meaningful conversations about the future is a wonderful way to start your visit. Talk about aging and how they see the process going. It is important that you know your parents wishes and it could be helpful for you to suggest what you expect the future to bring.

2. Safety. Spend an afternoon checking the surroundings for safety. Fix any tripping hazards, broken items around the home, items that need straightening, and be sure to ask if there is anything they need help with.

3. Health. Since it may have been a while since you have seen your aging parent you may notice they have changed. Be sure to look for key elements that should be red flags:

  • Weight Loss. This is the most obvious sign to spot. If you notice a lot of weight loss in your parent there could be something seriously wrong such as dementia, cancer, heart failure or depression. It could also be something as simple as a lack of energy to cook. If you are concerned you should schedule a doctor wellness visit.
  • Balance. Pay attention to how your parents walk and move around. Are they reluctant to walk? Find out if it is due to pain. If they are unsteady there may be a risk of falling and hurting themselves. You will want to have that checked out as well.
  • Environment. When looking around the house do you notice clutter? Unpaid bills? Piled up mail? This could be a sign that a problem exists. Take note of their prescriptions and check expiration dates. If there is anything to be concerned about you should talk to their physician.
  • Emotional. Look for signs of depression including sleep patterns, personal hygiene, home care, and any changes in behavior. If you notice your parent just isn’t acting like themselves it may time to have them checked out for ailments.

Visiting during the holidays is more than just a reunion; it is a time to keep an eye on the aging process of your parent. If you have any concerns having a heart to heart with them can help alleviate any worry. And don’t forget to enjoy yourselves.

Why More Americans Are Saving Their Retirement With Annuities – Part III

What Are The Different Types Of Annuities?

Annuities can be immediate or deferred. This is simply whether the income payments begin right away or later. Annuities can also be fixed or variable.

Fixed annuities guarantee your money will earn at least a minimum interest rate. Fixed annuities may earn interest at a rate higher than the minimum but the rate isn’t guaranteed until it is credited to your account. With a fixed annuity you are not investing directly in the market and insurance companies must promise that your money is protected from market losses for it to qualify as a fixed annuity.

Money in a variable annuity earns a return based on how the investments you choose perform. Your investments are called “subaccounts” which are investments in mutual funds or other investment products. Your investment choices likely will have different types of risk and will affect the return you earn on your annuity. You may also have a choice to put some money into a fixed account with a guaranteed minimum interest rate. If the value of the subaccounts goes down, you may have less money in your annuity than you paid into it.

Essential Retirement Planning Tips

Retirement doesn’t just happen. It takes years of planning. We have come up with some helpful tips to guide you in your plan for retirement.

1. Save. Many who retire have not saved up enough to last. Retirement is usually 20-30 years, which is the longest span of life. Also, retirement funds or pension is not paid out immediately. It usually takes several months or more to receive your first check. It is wise to have enough money in your savings for at least six months of your budget before you retire.

You should also know the maximum amount you can contribute to your 401(k) or 403(b) accounts and IRA’s. Consider limiting your expenses, having a reasonable budget and tax planning to help get the savings you need to live on throughout your retirement.

2. Budget. Creating a budget is one of the key factors in a successful retirement. However, there are many things that get overlooked when planning a budget. Don’t forget about inflation, emergencies, medical expenses, and more. Only a small percentage of people integrate a plan for helping their parents and/or children. Many times those that retire have parents that are still living and may rely on them for income.

When it comes to helping out your children you should have a certain amount set aside to help in case of an emergency. If it isn’t an emergency then you should not be afraid to say no and tell them that you are living on a fixed income.

3. Maximize Social Security. You may choose to start collecting Social Security right away; however, you should look at the benefits to waiting a little bit longer. Some may end up earning up to $100,000 or more in their lifetime by waiting. It is best to talk to your financial advisor to find out what age is best for you to start receiving this benefit.

4. Ask for help. Many baby boomers have a “do it myself” type of attitude. They are use to going online and researching. There is a lot of misinformation out there. It is okay to and you should ask for assistance from a financial advisor.

5. Have an open mind. Planning a budget can seem scary and feel like you are losing your freedom when in fact it is doing the opposite. Having a budget will give you the financial freedom throughout your retirement. There are a lot of opportunities to plan and save for your retirement. Give us a call to find out more.

Reducing Taxes on Your Social Security

Your Social Security Income will be taxed as you exceed a specific amount called the “Threshold Income”. What is Threshold Income? All types of earnings, dividends or interest are included as threshold income except for one. A deferred annuity is the only producing asset that allows interest to grow without being included as Threshold Income.

If your threshold income exceeds the following limits, up to 85% of the amount received from Social Security could be subject to tax:

The 2017 federal estate tax rates haven’t changed, but the lifetime maximum exemption amount has. The federal estate tax, also known as the death tax, is assessed on money and property you pass on to your loved ones after you die. The tax rates on estates are among the highest in the U.S. Tax code, with a maximum rate of 40%, but it may not be as “taxing” on you as it seems thanks to a big exemption amount.

Do you know how much Uncle Sam will inherit at your death?

The management strategies for your financial assets will change as you move through your life cycle. You may have reached a point in your life where preservation of assets has become the number one priority. Will Rogers once said, “…as a senior, I’m more concerned about the return of my principle, rather than the return on my principle.”

To learn more about deferred annuities please call to schedule an free consultation.

Why Seek Advice for ALTCS?

As life expectancies and long term care costs continue to rise, the challenge quickly becomes how to pay for these services. Many people cannot afford to pay $4,000 per month or more for the cost of a nursing home, and those who can pay may find their life savings wiped out in a matter of months, rather than years.

Fortunately, the ALTCS Program is there to help. In fact, in our lifetime, ALTCS has become the long term care insurance of the middle class. But the eligibility to receive ALTCS benefits requires that you pass certain tests on the amount of income and assets that you have. The reason for ALTCS planning is simple. First, you need to provide enough assets for the security of your loved ones. Second, the rules are extremely complicated and confusing. The result is that without planning and advice, many people spend more than they should and their family security is jeopardized.

Exempt Assets and Countable Assets: What Must Be Spent?

To qualify for ALTCS, applicants must pass some fairly strict tests on the amount of assets they can keep. To understand how ALTCS works, we first need to review what are known as exempt and non-exempt (or countable) assets. Exempt assets are those which Medicaid will not take into account (at least for the time being). In general, the following are primary exempt assets:

  • Home, no matter what its value. The home must be the principal place of residence. The nursing home resident may be required to show some “intent to return home” even if this never actually takes place.
  • Personal belongings and household goods
  • One car or truck
  • Burial spaces and certain related items for applicant and spouse
  • Up to $1,500 as a burial fund for applicant & spouse
  • Irrevocable prepaid funeral contract
  • Value of life insurance if face value is $1,500 or less. If it does exceed $1,500 in total face amount, then the cash value in these policies is countable.
  • Miller Trust (or Income Only Trust) – see our website for more information

All other assets are generally non-exempt, and are countable. Basically, all money and property, and any item that can be valued and turned into cash, is a countable asset unless it is one of those assets listed above as exempt. This includes:

  • Cash, savings, and checking accounts, credit union share and draft accounts
  • Certificates of deposit
  • Savings Bonds
  • Individual Retirement Accounts, (IRA), Keogh plans, (401K, 403B) (Exempt for the community spouse)
  • Nursing home accounts
  • Prepaid funeral contracts which can be canceled
  • Trust (depending on the terms of the trust)
  • Real estate (other than the residence)
  • More than one car
  • Boats or recreational vehicles
  • Stocks, bonds, or mutual funds
  • Land contracts or mortgages held on real estate sold

For assistance with qualifying for ALTCS please reach out to one of our specialists.

Is An Annuity Right For Me?

What are the advantages and disadvantages of an annuity?

The very significant advantage of owning an annuity is peace of mind. The assurance that no matter how long you live, that check from the insurance company will arrive in the mailbox every month. This can alleviate a major source of stress for many seniors.

The main disadvantage is loss of liquidity. That’s why retirement planning experts recommend a diverse portfolio in which a portion is dedicated to an annuity, leaving the remaining funds available for emergencies and other types of investments.

Annuity critics say the products are too complex, and some annuities have fees and features that can drag down your interest earnings. That’s why it takes a commitment to shop around and ask the right questions. Talking with a professional can help answer your questions and assist in finding an annuity that is tailored to your needs.

How do I know an annuity is right for me?

Some questions to ask in determining if an annuity is right for you include: Am I in good health? Can I afford to remove some of my nest egg and put it into an annuity? What are my retirement goals? What is my risk tolerance?

Where does an annuity fit in my retirement plan?

Top financial planners recommend an annuity to address longevity risk and provide guaranteed income. The important part is to have a balanced retirement plan. Providing an income from an annuity enables you to take a little more risk with remaining money.

Many financial planners recommend rolling an IRA, or a percentage of it, into an annuity. In addition to providing income and longevity insurance, rolling into an annuity is a tax-free process.

Caring for Aging Parents with Your Siblings

Caring for an aging parent can be a struggle alone, but add in your siblings and things can get stressful. It is important to work together as a team to support your parent. You may each have a different idea of how your parent should be taken care of which can cause stress and tension. At the same time your parent is aware that they are relying more and more on their children and are probably not happy about it.

Caring for a parent is a shared responsibility. It is important, however, to assign a primary care provider. Consider who is the most dependable, has the most time to devote to their parents care, and who is emotionally prepared to fill this role. Once that is established you can decide what the other siblings roles will be and what they can provide.

It may be best to schedule a family meeting. Make sure everyone has time to discuss their feelings and how they see the care being handled. If you feel there will be contention it may be best to host the family meeting with a facilitator such as a social worker, family friend or other trusted person outside the family. To have a productive meeting try these guidelines:

  • Set an agenda for the meeting.
  • Focus on the now – try not to bring up issues from the past.
  • Share how you feel instead of accusing others (keep your sentences using ‘I’ instead of ‘you’).
  • Listen and respect what others are saying. Give everyone time to speak.
  • Find a way to come to a compromise. Everyone may not get their way, but at least you can all come to an understanding. Everyone may have to give a little.

If you find that anyone in particular doubts that their parent needs care have them spend a week or even a day with the parent to see a first hand view of the issues.

It is also important to have your parent draw up an Advanced Health Care Directive. They have an idea of who they want to make their major decisions and they should have a choice in the matter.

Creating A Trust for Your Spouse or Child With Special Needs

Preparing to leave your loved one an inheritance when they have special needs must be done with care. Most individuals that have some sort of ailment or impairment are usually on government assistance. Leaving them any sort of inheritance can disqualify them from continuing to receive that assistance.

There are ways to prevent the loss of this assistance. With a Miller Trust (also known as an Income Only Trust) you will rest assured that their Medicaid won’t be taken away from them.

Setting up this trust has a few steps:

  1. Have the Miller Trust prepared by an Estate Planner such as with Legal Awareness for Seniors. We will have the correct wording drawn up as to maintain any financial assistance they are currently on or will be receiving through any programs.
  2. Open a bank account in the name of the newly acquired trust. The tricky part is that when you open the account you cannot have an opening balance. Most banks will give you a hard time about this, but there are banks out there that are familiar with and will accommodate this request.
  3. Reach out to social security, pensions, and any other income resources your loved one is receiving. Have them deposit their funds directly into the newly set up bank account.

Once everything is set up the funds can be used towards your loved one. However, there are some stipulations. These funds cannot be used directly to purchase shelter, clothing, food or any of the services that the government benefits will normally provide. The funds are commonly used to pay for vacations, home furnishings, personal care attendance, education, recreation, vehicles, physical rehabilitation and so on.

The reason this type of trust works is because Medicaid (in Arizona it is called ALTCS) sees the income being received by the Trust and not the individual. To accurately set up this type of document and received guidance you will want to work closely with us at Legal Awareness for Seniors.

The Difference Between Hospice, Palliative and Respite Care

Learning the different types of care that are available can be important on making the right decision for your loved one.

Hospice Care
This is designed to make the last days, weeks or months of the terminally ill and their families more comfortable. Hospice will comfort the patient emotionally and physically as best they can as well as help the family with the transition and decisions they will need to make. In the United States there are about 40% of patients in Hospice Care that receive the care at home. Patients that are transferred to Hospice Care are referred by their doctor and usually have six months or less to live.

Palliative Care
This type of care is for anyone that is having a major health crisis and needs help managing it. They are not necessarily at the end of their life. This type of care helps patients manage pain, stress, depression, and physical ailments. The care providers will focus on relieving and prevent the patient from suffering.

Respite Care
This is a short-term stay at a community or assisted living facility. This is most commonly used for seniors who are living with their children. This gives them a break from each other or gives the family security knowing their loved one is being cared for while they are traveling.  Respite Care is also used to ease your loved one into assisted living, giving them a trial run of what life may be like in a senior living community.