A U.S. Department of Health and Human Services report from 2019 estimates that 70% of Americans over the age of 65 will need some form of long-term care (LTC). Because trusts provide better asset protection than wills, trusts are becoming the preferred option for estate planning. We invite you to join Jeff as he takes a closer look at this important trend so that you can make sure that you and your family are sufficiently protected.
Your host, Jeffrey R. Bellomo, the founder of Bellomo & Associates, is a licensed and certified elder law attorney with a master's degree in taxation and a certificate in estate planning. He explains complex legal and financial topics in easy-to-understand language.
Key Takeaways
03:27 – Leaving assets vulnerable before death
Wills instruct how to transfer assets after someone dies
Wills do not protect a person's assets while they are alive, especially when using long-term care (LTC)
It is estimated that 1 in 3 people will have some form of dementia and 2 out of 3 people will need some type of custodial LTC
The growing need for LTC has resulted in a growing need for people to use trusts for asset protection
07:41 – Leaving assets vulnerable after death
Using a will after death to transfer assets outright can leave assets vulnerable to the spouse's need for LTC, a grown child's divorce, outside creditors, etc.
Asset protection after death should be an essential part of estate planning
09:44 – Changing practices in asset protection
It has been common practice to use a will to create a separate share trust upon death to protect assets
Assets transferred into a trust upon death are not subject to the five-year lookback period
Trust companies are becoming less willing to allow this practice
12:21 – Speed of asset distribution
A will must go through probate, the state's process to carry out the decedent's wishes
After advertising the estate, creditors have one year to make claims against assets, which can create delays in asset distribution and upset creditors and beneficiaries
Typically, funds can be distributed more quickly when in a trust
17:10 – The value of an asset protection trust
More thorough asset protection
Growing need for LTC
Provides flexibility to make other asset protection decisions
Better to act before you and your family are in crisis
Saves money on the back end
Speed of distribution and ease of handling
Fewer fees to county and state
For more information, call us at (717) 845-5390.
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