No one mentions the down side of going into a nursing home as a Medicaid patient is the nursing home gets paid a fraction of the private rate. You are not an attractive patient to them - they want the private pay patient who is paying say $200/day. Medicaid might pay $160. Now factor in how much care mom or dad is. A nursing home does not want a heavy care patient at the Medicaid rate. If you have paid privately for a few years and funds are exhausted, they usually will keep you on Medicaid but to go In immediately being straight Medicaid, you aren’t going to get to choose the A List facility. The money would be better put giving a patient quality care than having the kids line their pockets.
Three things come to mind. First, the money MUST go into a trust that you don't control. If your trustees think you don't need a new car or a nice vacation, you don't get it because you don't control the trust. Second, factor in SS. The average SS recipient receives $1900/month, times two times 12 equals $45,600/year. So they aren't draining $160,000/year, after adding a very conservative 5% growth, more like $90,000/year. So at the end of four years they still would have their home and $100,000. Third, compare Medicaid nursing homes vs private pay, the difference is shocking! I wouldn't subject my wife to that in order to leave my kid some extra money!
Unfortunately my mother got Alzheimer’s and was extremely bitter angry and difficult to deal with. It wasn’t until she went into the nursing home that they gave her a shot to make her a normal human there is no way in the world that I could’ve handled my mother at home I’m fortunately
I think it is a bit much to say “America” disagrees with Dave Ramsey. You disagree with DR, but I don’t and perhaps a few other Americans don’t either. It may be legal to shelter assets but not necessarily ethical. I am a high net worth individual that expects to pay for my own care and leave the remainder to my kids rather than taking Medicaid. If concerned about long term care costs, then buy a modified long term care insurance policy with a death benefit.
Geesh. Fewer LTC policies exist. Some will go bankrupt before 10 years. Many cannot afford long term care. You can afford your care because it takes $$ to make money and you use every legal deduction to hold on to it and not pay into the IRS a decent %. Stop whining that elderly less wealthy are using legal means to fund a pitiful retirement last years in nursing homes, while leaving something behind for their kids, charities or friends. If your iRS tax deductions are legal, but you don’t really need them, pay instead! Only then can you be on high horse to say this drivel.
If R. really advocated this he needs his head examined. I just spent the past four years managing the affairs of my parents, especially my father who had dementia. He had long term care insurance. Even so I was spending $15k/month on his care in his final months because the insurer only covers about 30% of home care. I never did put my father in a nursing home and I'm glad I didn't. I did place him into assisted living (memory care unit) for about 14 weeks but he got kicked out because he kept falling and being able to walk is a condition for living in these units. After that we kept him at home until he passed. But no way was I going to spend every penny and not keep some of the assets legally protected.
Best example of why visiting an estate attorney, then a CPA, even for modest asset families, makes sense. Even if it just results in good, knowledgeable conversations in families. There is no "one size fits all".
Wait. In a newer video I though you discouraged this approach because Medicaid funded nursing homes can be substandard and that it is easy to invalidate the 5 year rule with unallowed fund transfers.
Paul - thanks so much! This topic is very cogent to multiple conversations I currently am having with friends and family about this very subject! Your explanation for the need for a Medicare Asset Protection Trust could not be presented any more clearly. I just wished I lived in Louisiana so I could take advantage of your expertise.
Having been through this three times I would offer two pieces of advice: (1) Don't assume that Medicaid requirements can't change because they CAN. Any rule, including those for irrevocable trusts can be changed by a US judge anytime he see an injustice. Bye trusts!!! Get a complete explanation of the lawyers fees and extras. Some of them are VERY EXPENSIVE so clear the air on that VERY EARLY.
“Not like the nursing home is not getting paid” correct Medicare is paying. But as an American taxpayer I’m am paying for it instead of the family that is using it.
The person receiving Medicaid - has also paid for it their entire life if they worked. And my employer paid for me also. So they are really taking anything from you. They are using what they paid also. Will it cover everything - no. But the government shouldn't keep it. Does the government pay the estate if they never used medicaid, all that the person has paid in. Nope.
The difference between avoiding estate taxes and keeping your money from Medicaid is that in one example you are avoiding giving others money and the other you are taking others money.
I agree with both of you. It is taking advantage of welfare, but it also a part of a system we're all paying into. Who's really to say if it's right or wrong... What I do know is as someone that's prepping myself for caregiving for my elderly parents, I really really wish we did more for our seniors in this country. This is such a scary process with so many uncertainties and cases where they can end up SOL or without proper care.
I’ll pray for you. Taking on the care of parents is so incredibly hard. Not that I’d know. I’m only 77. Where Medicare is federal and Medicaid is state, Medicaid coverage will vary widely. There are tons of rules such as not divesting any property within five years of applying, meeting the level of care, etc. There is huge controversy between Medicare and Medicare Advantage. Advantage sounds better on the surface but it pays to speak to an expert in the field (not someone selling you the Advantage program). I hope you have a policy that will help with home care, coming in a few times a week for personal assistance is a sanity saver. Wishing you the best!
Well, you have to be careful listening to Dave on more than just this sort of thing. He was born to upper middle class, pretty well-connected parents who helped him get into the real estate business at age 18, and through that and their connections this kid, with no particular education or skills, went millions of dollars into debt. He tells the story very plainly. When the bank changed hands the new bankers realized that this 25-year-old who is not a doctor or even a lawyer owed the bank millions of dollars. Hmm. Naturally, they freaked out and called the notes and that was that. He then explained to a caller a couple of years ago asking about her 27 year old husband getting into the flipping business that “it’s not a point of entry for most folks”. Dave very honestly explained that he was able to flip houses with no cash and no credit even post bankruptcy because he “knew all of the investors around”.
My brother was a successful real estate broker in Hawaii who had some rough years because his expenses were so high. After listening to Dave Ramsey, he got out of debt and restructured his business. Not too long ago, he had a messy divorce from his wife of 25 years. And now he has a new wife and is retired in Missouri. They live in a nice home by a lake where they take their boat out fishing, relax in their hot tub, and do a lot of traveling. They were just in her home country of Austria not too long ago. So, I would say that Dave Ramsey's advice is pretty solid for the most part. But that doesn't make anyone right 100% of the time. And I will say that what brother pulled off isn't something that anyone could do. Only a tiny percentage of realtors are successful at all. And those who achieve his level of success are fewer still. So even if the general principles being taught are solid, you need to be careful how you apply them. You need to look at your own situation and give the whole thing some thought. And you also need to consider that different people can realistically achieve different levels of success. For instance, it's very unlikely I'm going to earn the kind of income my brother has. But I can do quite a bit with what I have. I'm already living far better than most people at the same income level. I'm below the poverty line and have a standard of living the same or better than a lot of middle class people.
Great video and point. I haven't heard Dave talk about this but the same people who say it is wrong to take steps to qualify for Medicaid are themselves taking all legal and proper tax deductions. Like contributions to church and charity. Nothing wrong with following and staying within the rules. That's not fraud -- that's just smart. Thanks for the excellent video. John Watts
Great video, thanks Would love to know if there is such a thing as high deductible long term care insurance. As in we pay the first $300,000 of expenses, and the insurance covers the remainder for as long as needed, with maybe a $2 million lifetime limit. That is an insurance product that would be a good fit for many people. But does it exist, and guaranteed by state insurance pools? Thanks
Yes, there is long term insurance but it is crazy expensive and naturally, who knows if you need it two weeks or two years? Like all insurance, there are multiple plans sold by various insurance companies and your age now makes a huge factor. Normally, LT.c insurance covers a portion of the bill - not the whole thing but I’d be interested to know if there is 100% coverage. It’s certainly a huge amount to lay out with no idea how long you need it. I’d be interested to find out if you do find such a policy.
Excellent points. But I think one thing that's important to remember about Dave Ramsey is that, in many cases, his advice in one area works in tandem with his advice in another area. One major reason that he doesn't recommend re-titling assets is that he also recommends getting robust long-term care insurance policies. So, someone who was fully following Dave's advice in this area would actually not fit under either couple A or couple B. His advice would be for couple C to both get long-term care policies which will allow them to keep their assets in their names AND pay for long-term care.
That would be a valid reason. Perhaps you have a better way to handle the situation from a financial standpoint. But there is certainly no ethical reason as what seems to be implied here. People who suggest that you shouldn't take advantage of government benefits you are eligible for are teaching you to be financially irresponsible. Whether the government should offer a particular benefit is a separate issue worthy of discussion. But while they are, I'm certainly going to take advantage of it, provided that doing so works within my financial plan. I'm on social security disability because of my autism. One of the first things I did when I got on disability was to take advantage a program that would allow my student loans to be forgiven. That was about $20,000 that I now didn't need to repay. I also get food stamps to help me with my groceries, rental assistance, free cell phone service, $30 off my internet service, and a discount on at least one of my streaming services. I have Amazon Prime and Hulu. But I don't waste money on cable television. Do I feel bad about taking advantage of any of those benefits. Hell no. My monthly check is less than $1,000. My rent alone would be $600. Who could survive on that? My brother said that $1,000 isn't a whole lot of money. I said that it was when you pay $200 a month for rent. Basically, my financial strategy has been to sign up for any government benefits I can, reduce my monthly expenses, and built up my savings. And it's working. I'm not living like a rock star. But I'm not doing too badly. I have more than enough money to pay my bills, can have a few luxuries, and I have plenty of money set aside for emergencies or making large purchases. I don't own a credit card and can borrow against my own savings when I need to make large purchases. Then I just make monthly payments back to myself to build my savings back up again. I now have a home gym in my living room because of that strategy along with a nice recliner. And I have no debts. Dave Ramsey should be proud, I would think.
Get a basic policy you can afford I bought one that is 2 years and if longer it's a partnership with Medicaid and you buy what assets you want to preserve me 200k
I totally agree. My parents saved a lot of money. My Dad always said we would have 'plenty' of money to pay someone to empty out their house. A year ago, my Dad had a right handed stroke and is in a nursing home. The cost here in Illinois for skilled nursing 24/7 is $15,500 a month and is supposed to go up 9 percent this month. They have a policy that pays for less than 1/3 of that cost. Their money is dwindling - especially after they lost a lot in the stock market. I need to decide what to do about a long term insurance policy for us.
He also says to buy long term care to pay for those types of services. Some people are just cheap and don't want to protect themselves with insurance. Being on Medicaid sucks, and all of the facilities that are primarily funded by Medicaid are at >95% capacity. This lawyer is leaving out that there is insurance for nursing homes and home care.
Hello, I’ve been watching you LTC vids. Question: in the event I follow your “irrevocable trust” advice but find myself in a nursing home 3 years after establishing/funding the trust … what happens?
At the end of the day, you are gaming the system. I promise Medicaid doesn’t want everyone to do this, otherwise it would just be a social program we all benefit from, not just for the people in the know. Also, Medicaid doesn’t reimburse what Long Term Care facilities charge. In my state, many of the LTCs stopped taking Medicaid residents because of this. Medicaid finally increased their reimbursement rates, and the facilities are taking them now, but they still aren’t at 100% reimbursement. Also, it’s not uncommon for a facility to only have a limited number of Medicaid beds because they reimburse less. With all that said, I’m not against people not following Dave’s advice because these facilities are too expensive.
Dave says purchase Long Term Care insurance. Dave says in order to not break the law don’t sell or transfer. I don’t understand Dave to say don’t sell or transfer, but to do it legally and to purchase LTC that is not life insurance. Last thing I heard him say was if you want to purchase long-term care as a life insurance writer, have your kids pay for the life insurance rider, part of it, and only purchase the long-term care.
I'm new to learning Estate Planning. I live in California and recently set up a Trust for my family. Our main asset in the Trust is our home. If my Husband and I were to need long term care more than 5 years from now our house is safe in the Trust correct? We're in our 30s and 40s so I'm hoping that we don't need long term care for MANY years.
If it's a revocable living trust, which it likely it, then it doesn't offer protection from creditors. A living trust a makes settling an estate easier for those that inherit it. They types of vehicles that would provide protection from creditors are not typically used by people whose main asset in only the own private residence. You might want to seek the advice a "fee only certified financial planner", they will likely recommend long term care insurance down the road (statistically you shouldn't need it now).
Here's my issue with this. These people aren't poor to begin with. But, to keep wealth where they wish it to be, they are going to make legally allowable financial maneuvers, with the intent, that if they live too long in a nursing home, that the taxpayer can foot the remainder of the bill. Legally OK, but morally not so much, in my opinion. If Medicaid were meant for everyone, rich and poor alike this would not be an issue for me, but the spirit of Medicaid is to help those people who are poor due to no fault of their own (as opposed to those who made themselves less rich by legal transfer of assets).
I just looked into LTC insurance as an option. While I can afford those rates now, I don't think I could long term. The rate increases from year to year are very high. Unfortunately, some people feel like doing what this attorney mentioned as their only other option.
Not necessarily. Many nursing homes have what are called Medicaid slots, space in nursing homes set aside for Medicaid cl's., who are cared for just like their private pay pt's. The Medicaid workers are going to determine where the pt. is placed so you will want to work with them to have your person placed in a decent home.
@@dresser6135 you have two people in a room with Medicaid not private. My dad had a private room until his money ran out. Then when Medicaid kicked in he was moved and didn’t have a private room anymore.
Dave Ramsey isn't an elder law attorney. It's best to consult with an elder law attorney and make arrangements with him or her. It'll put your mind at ease.
Yes the nursing homes get paid either way, however Medicaid pays half of what private pay is. That’s why 20+ non profit nursing homes a year go under in Wisconsin. Between Medicaid paying garbage and the regulatory requirements it’s a lose-lose for everyone
Sir, you're suggesting ways to put more pressure on Medicaid and the overall US economy. Very nice! Maybe just suggest that people purchase LTC insurance, no?
Good information, very helpful. Now I know there’s so much that I don’t know. One minor suggestion, close your door next time, the lady walking past your door several times didn’t seem to know where she was supposed to be.
Nursing homes rarely get paid when folks get an irrevokable trust and then need care before the 5 year look back is up. Because irrevokable means irrevokable. Especially waiting as late as 72 per your example. I don't understand why you're not acknowledging that Dave Ramsey was advocating for LTC insurance, not self insuring and spending down to qualify for Medicaid. I have worked in the LTC industry for 4 years dealing with these situations and while Medicaid pays nursing homes, they accept a significantly lower Medicaid rate. The government rarely if ever breaks even with estate recovery. And people wonder why nursing facilities are so unfavorable. Imo this strategy is cancer to the industry.
If one has lived a full life and sees the end ahead, he might wish to tie all his personal loose ends: notify and place all valuable assets in the names of heirs. OD on a sedative before for a swim in the pleasant blue water of the deep ocean. Don't pay the estate attorneys, the undertakers, the crematory! Do it yourself!
Love the content. 25% of peeps that go into a nursing home die w/i 3 months. 50% ore dead in 1 year. I wonder if just putting some cash in a TIPS for a couple years of nursing home expenses might be best,
My partner and I took established a Revocable Will and Trust (July 2013) essentially to forestall our relatives from swooping in if one of us passes away - and we thought it was a complete waste of money. We don't believe that today 3/29/2023 because My partner just applied for Medi-CAL (Medicaid) for his nursing home care. All of our assets are protected even the cash on hand down up to $195K, we have much less than that so we are told that down the road Medi-Cal Fund Recovery can't touch our assets. I hope this holds true?
Exactly, AND Dave Ramsey advocates LTC for anyone that doesn't have a fairly high networth, which the example "couple" does not. I understand the the video has a different philosophical view on using Medicaid, but the video is cherry picking by not explaining Ramsey's advice in it's entirety which includes LTC.
No Nursing homes! Hospice, Medicare, Government! Yes, Living Trust necessary protects assets! Couple A, had $ ching, ching? After depleting funds, give them Morphine! Hospice Hell! UA-cam, happened to me!
Yes, but the very best nursing homes want you to pay some up front before you exhaust your money and go on Medicaid. 15k might be enough to get into a better nursing home.
Ramsey says people should protect their estate by getting long term care insurance, the presenter conveniently forgets that as many other commenter also point out. The video is cherry picking what Ramsey says about paying for care, he doesn't say you should go broke.
Ramsey does promote LTC, but many of those policies only pay for a limited amount of time. I called his show about this. My husband was diagnosed with FTD dementia (like Brice Willis) at age 52. Most folks don’t purchase those types of policies that young. When I called Dave, he was all against doing the trust, but he didn’t give any viable options. He kept sAying my husband would be on welfare. Of course, what he didn’t mention was that if we spent all of our money, then I would be on welfare.
seems couple b gambled and got lucky that they didnt enter the nursing home sooner than the 5 year cutoff from time they signed over their estate to their family...seems if couple b had went in nursing home 4 years after signing away estate they would have also ended up like couple A ?
No one mentions the down side of going into a nursing home as a Medicaid patient is the nursing home gets paid a fraction of the private rate. You are not an attractive patient to them - they want the private pay patient who is paying say $200/day. Medicaid might pay $160. Now factor in how much care mom or dad is. A nursing home does not want a heavy care patient at the Medicaid rate. If you have paid privately for a few years and funds are exhausted, they usually will keep you on Medicaid but to go In immediately being straight Medicaid, you aren’t going to get to choose the A List facility. The money would be better put giving a patient quality care than having the kids line their pockets.
Three things come to mind. First, the money MUST go into a trust that you don't control. If your trustees think you don't need a new car or a nice vacation, you don't get it because you don't control the trust. Second, factor in SS. The average SS recipient receives $1900/month, times two times 12 equals $45,600/year. So they aren't draining $160,000/year, after adding a very conservative 5% growth, more like $90,000/year. So at the end of four years they still would have their home and $100,000. Third, compare Medicaid nursing homes vs private pay, the difference is shocking! I wouldn't subject my wife to that in order to leave my kid some extra money!
PS, No Nursing Homes....keep people in THEIR homes, hire help! Cost so much less, they deserve to maintain Independent and Dignity!
Mary Kennedy amen to that
My 99 yr. old mother is living with me. I alone care for her. I fear waking up one day and finding her dead.
That is so simple when you compare that giving everything away to nursing homes and lawyers.
Unfortunately my mother got Alzheimer’s and was extremely bitter angry and difficult to deal with. It wasn’t until she went into the nursing home that they gave her a shot to make her a normal human there is no way in the world that I could’ve handled my mother at home I’m fortunately
We need more Adult day center in this world . They help alot
I think it is a bit much to say “America” disagrees with Dave Ramsey. You disagree with DR, but I don’t and perhaps a few other Americans don’t either. It may be legal to shelter assets but not necessarily ethical. I am a high net worth individual that expects to pay for my own care and leave the remainder to my kids rather than taking Medicaid. If concerned about long term care costs, then buy a modified long term care insurance policy with a death benefit.
Geesh. Fewer LTC policies exist. Some will go bankrupt before 10 years. Many cannot afford long term care. You can afford your care because it takes $$ to make money and you use every legal deduction to hold on to it and not pay into the IRS a decent %.
Stop whining that elderly less wealthy are using legal means to fund a pitiful retirement last years in nursing homes, while leaving something behind for their kids, charities or friends.
If your iRS tax deductions are legal, but you don’t really need them, pay instead! Only then can you be on high horse to say this drivel.
If R. really advocated this he needs his head examined. I just spent the past four years managing the affairs of my parents, especially my father who had dementia. He had long term care insurance. Even so I was spending $15k/month on his care in his final months because the insurer only covers about 30% of home care. I never did put my father in a nursing home and I'm glad I didn't. I did place him into assisted living (memory care unit) for about 14 weeks but he got kicked out because he kept falling and being able to walk is a condition for living in these units. After that we kept him at home until he passed. But no way was I going to spend every penny and not keep some of the assets legally protected.
Best example of why visiting an estate attorney, then a CPA, even for modest asset families, makes sense. Even if it just results in good, knowledgeable conversations in families. There is no "one size fits all".
Wait. In a newer video I though you discouraged this approach because Medicaid funded nursing homes can be substandard and that it is easy to invalidate the 5 year rule with unallowed fund transfers.
This is probably the only thing I agree with Dave on. If you want the care, you pay for the care.
Paul - thanks so much! This topic is very cogent to multiple conversations I currently am having with friends and family about this very subject! Your explanation for the need for a Medicare Asset Protection Trust could not be presented any more clearly. I just wished I lived in Louisiana so I could take advantage of your expertise.
Doesn't the government take into account your monthly pension?
Having been through this three times I would offer two pieces of advice: (1) Don't assume that Medicaid requirements can't change because they CAN. Any rule, including those for irrevocable trusts can be changed by a US judge anytime he see an injustice. Bye trusts!!! Get a complete explanation of the lawyers fees and extras. Some of them are VERY EXPENSIVE so clear the air on that VERY EARLY.
“Not like the nursing home is not getting paid” correct Medicare is paying. But as an American taxpayer I’m am paying for it instead of the family that is using it.
Medicare doesn’t pay for long term nursing home care…
You meant "MedicAID, right?
And the people using Medicaid now were once taxpayers paying for others in nursing homes.
Yup
The person receiving Medicaid - has also paid for it their entire life if they worked. And my employer paid for me also. So they are really taking anything from you. They are using what they paid also. Will it cover everything - no. But the government shouldn't keep it. Does the government pay the estate if they never used medicaid, all that the person has paid in. Nope.
The difference between avoiding estate taxes and keeping your money from Medicaid is that in one example you are avoiding giving others money and the other you are taking others money.
I agree with both of you. It is taking advantage of welfare, but it also a part of a system we're all paying into. Who's really to say if it's right or wrong... What I do know is as someone that's prepping myself for caregiving for my elderly parents, I really really wish we did more for our seniors in this country. This is such a scary process with so many uncertainties and cases where they can end up SOL or without proper care.
Welfare is for those that need it. You can't escape that moral aspect.
I’ll pray for you. Taking on the care of parents is so incredibly hard. Not that I’d know. I’m only 77. Where Medicare is federal and Medicaid is state, Medicaid coverage will vary widely. There are tons of rules such as not divesting any property within five years of applying, meeting the level of care, etc. There is huge controversy between Medicare and Medicare Advantage. Advantage sounds better on the surface but it pays to speak to an expert in the field (not someone selling you the Advantage program). I hope you have a policy that will help with home care, coming in a few times a week for personal assistance is a sanity saver. Wishing you the best!
Most do NOT provide proper ❤ for loved ones when your back is turned.
Well, you have to be careful listening to Dave on more than just this sort of thing. He was born to upper middle class, pretty well-connected parents who helped him get into the real estate business at age 18, and through that and their connections this kid, with no particular education or skills, went millions of dollars into debt.
He tells the story very plainly. When the bank changed hands the new bankers realized that this 25-year-old who is not a doctor or even a lawyer owed the bank millions of dollars. Hmm. Naturally, they freaked out and called the notes and that was that.
He then explained to a caller a couple of years ago asking about her 27 year old husband getting into the flipping business that “it’s not a point of entry for most folks”. Dave very honestly explained that he was able to flip houses with no cash and no credit even post bankruptcy because he “knew all of the investors around”.
My brother was a successful real estate broker in Hawaii who had some rough years because his expenses were so high. After listening to Dave Ramsey, he got out of debt and restructured his business. Not too long ago, he had a messy divorce from his wife of 25 years. And now he has a new wife and is retired in Missouri. They live in a nice home by a lake where they take their boat out fishing, relax in their hot tub, and do a lot of traveling. They were just in her home country of Austria not too long ago. So, I would say that Dave Ramsey's advice is pretty solid for the most part. But that doesn't make anyone right 100% of the time. And I will say that what brother pulled off isn't something that anyone could do. Only a tiny percentage of realtors are successful at all. And those who achieve his level of success are fewer still. So even if the general principles being taught are solid, you need to be careful how you apply them. You need to look at your own situation and give the whole thing some thought. And you also need to consider that different people can realistically achieve different levels of success. For instance, it's very unlikely I'm going to earn the kind of income my brother has. But I can do quite a bit with what I have. I'm already living far better than most people at the same income level. I'm below the poverty line and have a standard of living the same or better than a lot of middle class people.
Consider: many quality nursing won’t accept you as a patient if you are a medicaid patient immediately. Medicaid does not pay well.
Great video and point. I haven't heard Dave talk about this but the same people who say it is wrong to take steps to qualify for Medicaid are themselves taking all legal and proper tax deductions. Like contributions to church and charity.
Nothing wrong with following and staying within the rules. That's not fraud -- that's just smart.
Thanks for the excellent video.
John Watts
Great video, thanks
Would love to know if there is such a thing as high deductible long term care insurance. As in we pay the first $300,000 of expenses, and the insurance covers the remainder for as long as needed, with maybe a $2 million lifetime limit. That is an insurance product that would be a good fit for many people. But does it exist, and guaranteed by state insurance pools?
Thanks
Yes, there is long term insurance but it is crazy expensive and naturally, who knows if you need it two weeks or two years? Like all insurance, there are multiple plans sold by various insurance companies and your age now makes a huge factor. Normally, LT.c insurance covers a portion of the bill - not the whole thing but I’d be interested to know if there is 100% coverage. It’s certainly a huge amount to lay out with no idea how long you need it. I’d be interested to find out if you do find such a policy.
Excellent points. But I think one thing that's important to remember about Dave Ramsey is that, in many cases, his advice in one area works in tandem with his advice in another area.
One major reason that he doesn't recommend re-titling assets is that he also recommends getting robust long-term care insurance policies. So, someone who was fully following Dave's advice in this area would actually not fit under either couple A or couple B. His advice would be for couple C to both get long-term care policies which will allow them to keep their assets in their names AND pay for long-term care.
That would be a valid reason. Perhaps you have a better way to handle the situation from a financial standpoint. But there is certainly no ethical reason as what seems to be implied here. People who suggest that you shouldn't take advantage of government benefits you are eligible for are teaching you to be financially irresponsible. Whether the government should offer a particular benefit is a separate issue worthy of discussion. But while they are, I'm certainly going to take advantage of it, provided that doing so works within my financial plan. I'm on social security disability because of my autism. One of the first things I did when I got on disability was to take advantage a program that would allow my student loans to be forgiven. That was about $20,000 that I now didn't need to repay. I also get food stamps to help me with my groceries, rental assistance, free cell phone service, $30 off my internet service, and a discount on at least one of my streaming services. I have Amazon Prime and Hulu. But I don't waste money on cable television. Do I feel bad about taking advantage of any of those benefits. Hell no. My monthly check is less than $1,000. My rent alone would be $600. Who could survive on that?
My brother said that $1,000 isn't a whole lot of money. I said that it was when you pay $200 a month for rent. Basically, my financial strategy has been to sign up for any government benefits I can, reduce my monthly expenses, and built up my savings. And it's working. I'm not living like a rock star. But I'm not doing too badly. I have more than enough money to pay my bills, can have a few luxuries, and I have plenty of money set aside for emergencies or making large purchases. I don't own a credit card and can borrow against my own savings when I need to make large purchases. Then I just make monthly payments back to myself to build my savings back up again. I now have a home gym in my living room because of that strategy along with a nice recliner. And I have no debts. Dave Ramsey should be proud, I would think.
Get a basic policy you can afford I bought one that is 2 years and if longer it's a partnership with Medicaid and you buy what assets you want to preserve me 200k
@@markshy5463 - how did you go about purchasing your coverage? Is their a marketplace online or does your state government list authorized plans?
I definitely recommend seeing a good attorney
I totally agree. My parents saved a lot of money. My Dad always said we would have 'plenty' of money to pay someone to empty out their house. A year ago, my Dad had a right handed stroke and is in a nursing home. The cost here in Illinois for skilled nursing 24/7 is $15,500 a month and is supposed to go up 9 percent this month. They have a policy that pays for less than 1/3 of that cost. Their money is dwindling - especially after they lost a lot in the stock market. I need to decide what to do about a long term insurance policy for us.
He also says to buy long term care to pay for those types of services. Some people are just cheap and don't want to protect themselves with insurance. Being on Medicaid sucks, and all of the facilities that are primarily funded by Medicaid are at >95% capacity. This lawyer is leaving out that there is insurance for nursing homes and home care.
Yea, he is cherry picking Ramsey's advice. Buy LTC if you don't have a high enough net worth to self insure.
Goes along the same line of thought as "Every man should arrange his affairs so as to pay as little tax as possible".
Hello, I’ve been watching you LTC vids. Question: in the event I follow your “irrevocable trust” advice but find myself in a nursing home 3 years after establishing/funding the trust … what happens?
I guess it will fall into the 5 year look back rule, based on this video.
I agree with you over Dave on this point. It's called advance planning.
Is the 5 year rule still the rule for 2022 and 2023
Good thoughts - will look into this promptly
"Medicaid pays ..." You mean, taxpayers pay"?
What about his point on Long Term Care insurance? Wouldn't that cover the nursing home cost?
Thanks.
Paul, can you recommend a estate planning lawyer in the Williamsburg, Va area?
At the end of the day, you are gaming the system. I promise Medicaid doesn’t want everyone to do this, otherwise it would just be a social program we all benefit from, not just for the people in the know. Also, Medicaid doesn’t reimburse what Long Term Care facilities charge. In my state, many of the LTCs stopped taking Medicaid residents because of this. Medicaid finally increased their reimbursement rates, and the facilities are taking them now, but they still aren’t at 100% reimbursement. Also, it’s not uncommon for a facility to only have a limited number of Medicaid beds because they reimburse less. With all that said, I’m not against people not following Dave’s advice because these facilities are too expensive.
Thank you for your videos.
Dave says purchase Long Term Care insurance. Dave says in order to not break the law don’t sell or transfer. I don’t understand Dave to say don’t sell or transfer, but to do it legally and to purchase LTC that is not life insurance. Last thing I heard him say was if you want to purchase long-term care as a life insurance writer, have your kids pay for the life insurance rider, part of it, and only purchase the long-term care.
Love video. You seem really smart. How can I email you to get long term care insurance advice
similar in the UK
Thank you!
You are welcome.
I'm new to learning Estate Planning. I live in California and recently set up a Trust for my family. Our main asset in the Trust is our home. If my Husband and I were to need long term care more than 5 years from now our house is safe in the Trust correct? We're in our 30s and 40s so I'm hoping that we don't need long term care for MANY years.
If it's a revocable living trust, which it likely it, then it doesn't offer protection from creditors. A living trust a makes settling an estate easier for those that inherit it. They types of vehicles that would provide protection from creditors are not typically used by people whose main asset in only the own private residence. You might want to seek the advice a "fee only certified financial planner", they will likely recommend long term care insurance down the road (statistically you shouldn't need it now).
Here's my issue with this. These people aren't poor to begin with. But, to keep wealth where they wish it to be, they are going to make legally allowable financial maneuvers, with the intent, that if they live too long in a nursing home, that the taxpayer can foot the remainder of the bill. Legally OK, but morally not so much, in my opinion. If Medicaid were meant for everyone, rich and poor alike this would not be an issue for me, but the spirit of Medicaid is to help those people who are poor due to no fault of their own (as opposed to those who made themselves less rich by legal transfer of assets).
I just looked into LTC insurance as an option. While I can afford those rates now, I don't think I could long term. The rate increases from year to year are very high. Unfortunately, some people feel like doing what this attorney mentioned as their only other option.
Please say you disagree not America
That was a very good video
What about the quality of the nursing home? If you're relying on Medicaid to pay for your nursing home, won't you end up in the worst quality homes?
Not necessarily. Many nursing homes have what are called Medicaid slots, space in nursing homes set aside for Medicaid cl's., who are cared for just like their private pay pt's. The Medicaid workers are going to determine where the pt. is placed so you will want to work with them to have your person placed in a decent home.
@@dresser6135 you have two people in a room with Medicaid not private. My dad had a private room until his money ran out. Then when Medicaid kicked in he was moved and didn’t have a private room anymore.
@@dresser6135 Homes in general who take Medicaid patients are not as good as all private facilities.
Thank you Paul! You are 100% correct.
Dave Ramsey isn't an elder law attorney. It's best to consult with an elder law attorney and make arrangements with him or her. It'll put your mind at ease.
Agreed everything you said
Exactly
I'm going out at 75
😮
Yes the nursing homes get paid either way, however Medicaid pays half of what private pay is. That’s why 20+ non profit nursing homes a year go under in Wisconsin. Between Medicaid paying garbage and the regulatory requirements it’s a lose-lose for everyone
Where do you get your figures from? Those are pretty bold claims.
Sir, you're suggesting ways to put more pressure on Medicaid and the overall US economy. Very nice!
Maybe just suggest that people purchase LTC insurance, no?
Medicaid facilities are scary. If you want quality care get long term care and save for you elder care!
Good information, very helpful. Now I know there’s so much that I don’t know. One minor suggestion, close your door next time, the lady walking past your door several times didn’t seem to know where she was supposed to be.
save an run !!! get it?? Iam leaving soon -
Nursing homes rarely get paid when folks get an irrevokable trust and then need care before the 5 year look back is up. Because irrevokable means irrevokable. Especially waiting as late as 72 per your example. I don't understand why you're not acknowledging that Dave Ramsey was advocating for LTC insurance, not self insuring and spending down to qualify for Medicaid. I have worked in the LTC industry for 4 years dealing with these situations and while Medicaid pays nursing homes, they accept a significantly lower Medicaid rate. The government rarely if ever breaks even with estate recovery. And people wonder why nursing facilities are so unfavorable. Imo this strategy is cancer to the industry.
If one has lived a full life and sees the end ahead, he might wish to tie all his personal loose ends: notify and place all valuable assets in the names of heirs. OD on a sedative before for a swim in the pleasant blue water of the deep ocean. Don't pay the estate attorneys, the undertakers, the crematory! Do it yourself!
Love the content.
25% of peeps that go into a nursing home die w/i 3 months.
50% ore dead in 1 year.
I wonder if just putting some cash in a TIPS for a couple years of nursing home expenses might be best,
My partner and I took established a Revocable Will and Trust (July 2013) essentially to forestall our relatives from swooping in if one of us passes away - and we thought it was a complete waste of money. We don't believe that today 3/29/2023 because My partner just applied for Medi-CAL (Medicaid) for his nursing home care. All of our assets are protected even the cash on hand down up to $195K, we have much less than that so we are told that down the road Medi-Cal Fund Recovery can't touch our assets. I hope this holds true?
Sorry but LTC insurance will solve that
Exactly, AND Dave Ramsey advocates LTC for anyone that doesn't have a fairly high networth, which the example "couple" does not. I understand the the video has a different philosophical view on using Medicaid, but the video is cherry picking by not explaining Ramsey's advice in it's entirety which includes LTC.
So can my mom gift me money while she is in a facility
She shouldn't have money to gift if she is on Medicaid.
No Nursing homes! Hospice, Medicare, Government! Yes, Living Trust necessary protects assets! Couple A, had $ ching, ching? After depleting funds, give them Morphine! Hospice Hell! UA-cam, happened to me!
Is it right to hide assets to not pay the nursing home for the purpose of keeping money in the family? The taxpayers us pay the nursing home.
So Medicaid will pay for any nursing home regardless of how much it costs, private room and all, right?
Yes, but the very best nursing homes want you to pay some up front before you exhaust your money and go on Medicaid. 15k might be enough to get into a better nursing home.
Medicaid will pay for limited amenities, and homes that accept it are generally inferior.
Ramsey is dead wrong about Nursing homes! People have the right to protect their estate. Ramsey is helpful but not on this!
If the person accepts that he will be in an inferior nursing home.
Ramsey says people should protect their estate by getting long term care insurance, the presenter conveniently forgets that as many other commenter also point out. The video is cherry picking what Ramsey says about paying for care, he doesn't say you should go broke.
Ramsey does promote LTC, but many of those policies only pay for a limited amount of time. I called his show about this. My husband was diagnosed with FTD dementia (like Brice Willis) at age 52. Most folks don’t purchase those types of policies that young. When I called Dave, he was all against doing the trust, but he didn’t give any viable options. He kept sAying my husband would be on welfare. Of course, what he didn’t mention was that if we spent all of our money, then I would be on welfare.
seems couple b gambled and got lucky that they didnt enter the nursing home sooner than the 5 year cutoff from time they signed over their estate to their family...seems if couple b had went in nursing home 4 years after signing away estate they would have also ended up like couple A ?
You lost me at “America disagrees”. I’m pretty sure that you are not America’s spokesperson.
Dave Ramsey doesn't "optimize" income tax filing right, or should we call that fraud Dave;)
So you advise people to use other taxpayers’ money to pay for the care they incurred?