1. If I Don’t Have Debt, Should I Still Worry?
Does not having debt protect you?
A lady and her husband were shrewd, with little or no debt. They lived right, had rental houses, paid everything in cash with no mortgages.
Question: Did they have to worry?
If you or your husband have a long-term care event costing $75 to $100,000 per year, will that dent your finances?
Are the rental houses, bank account, savings going to be okay?
At that rate of spend-down, it’ll be hard maintaining your lifestyle.
So what can you do? Separate the liability with the rental houses and your personal income.
That way if the renter sues, it wouldn’t come back against your personal assets.
Separate your business liability. Maybe set-up an LLC and put all rental houses in it.
Separate it so your house, car, savings can’t be attacked.
How many layers of protection can you add? It’s up to you. The more layers, the more exhaustive to another plaintiff’s attorney to get at your nest egg and assets.
Another consideration is using an Irrevocable Asset Protection Trust to protect assets from a healthcare crisis requiring long-term care?
2. What If My Attorney-In-Fact Predeceases Me?
If the attorney-in-fact under a Power of Attorney passes away before you, then it ceases to have any power… unless you have appointed within the document second or third backup agents to serve as your attorney-in-fact. Think about it. If a player fouls out of the game you always want players on the bench to take their place.
3. I Already Have A Will…
People think they’re protected with a Will.
A will is great but can be a dangerous place to pass property.
If we’re passing your home through your will and open it to a probate estate in court, you must go to the courthouse, pay to open the estate, publish it in the paper, and wait 90 days (at least). That’s when liens such as Medicaid liens which may have paid for long-term care during your lifetime attach and force the sale of that property to pay that lien.
For information about other ways to easily avoid probate with real property (land/homes) and liquid assets (money/investments) contact:
Elder Law Attorney
McIntyre Elder Law
123 W. Marion Street
Shelby, NC 28150