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Jewish World Review
May 22, 2013/ 13 Sivan, 5773
Shielding assets from medicaid involves timing; more
By
Bruce Williams
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http://www.JewishWorldReview.com |
DEAR BRUCE: My wife wants to know about receiving stocks from her mother if her mother should go to a nursing home. Can the nursing home collect the stocks given to my wife if she receives them the same year that her mother goes into the home? We don't want the nursing home to get every nickel she has. -- Reader in Michigan
DEAR READER: What you're trying to accomplish -- protecting your mother-in-law's assets from Medicaid -- is obvious and understandable.
Unfortunately, just turning over the stocks to your wife is not enough. The transfer has to be accomplished during the "look-back" period, which is five years. In other words, if your mother-in-law applies for Medicaid long-term care benefits within five years of transferring the stocks to your wife, the state can attach that stock transfer. If your mother-in-law applies for benefits more than five years after the stock transfer, the transfer would not affect her eligibility.
This may not seem fair, but it should be pointed out that if you don't pay with your assets, the public has to pay with its assets. Medicaid was designed for people without money, not for those who have divested it. If you meet the look-back requirement, you can protect the money.
DEAR BRUCE: I am a 72-year-young single male and am looking to live some of my remaining years to the fullest. I own a condo that's worth about $75,000 with no mortgage. I have a small amount of money (about $7,500) for backup purposes and Social Security of $1,500 monthly. I live in South Florida, which isn't as expensive as New York, and I have a $360-a-month car payment with two years left. My condo maintenance fee is $240.
I would like to go on cruises and take a decent vacation, etc. Would a reverse mortgage help me accomplish this? -- Reader, via email
DEAR READER: At 72, you certainly qualify for a reverse mortgage. However, you are still relatively young, with a decent life expectancy, which means you will not get a whole lot of money. I would guess that, at the max, you might receive $30,000 on a condo worth $75,000.
The money would be advanced to you, and as long as you paid the maintenance fees and taxes, etc., you could live in the condo for life. Upon your demise, the condo would be sold and the money repaid to the lender. But at your age, $30,000 wouldn't go a long way.
You mentioned that you have a car payment that is approximately 25 percent of your monthly Social Security income. That is far too high, but I don't see much help for it now. In the future, you should strive for a considerably smaller car payment, which may mean buying used cars from this point forward.
Go to your local bank and see how much a reverse mortgage would yield. Then you can decide if it's worth it.
Every weekday JewishWorldReview.com publishes what many in the media and Washington consider "must-reading". Sign up for the daily JWR update. It's free. Just click here.
To comment or ask a question, please click here. (Questions of general interest will be answered in future columns. Owing to the volume of mail, personal replies cannot be provided.) Interested in buying or selling a house? Let Bruce Williams' "House Smart" be your guide. (Sales of the book help fund JWR).
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