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$10,000.00 per month at the time of Upon her passing, Rose’s life estate
writing. In the downstate region, the terminates, the house may be sold
cost of such care already exceeds that by her trustee, and the full proceeds
number by approximately 20%. As from the sale - all $400,000.00 - are
such, the cost of care quickly diminish distributed to her heirs as per the
your hard earned savings, and prevent terms of Rose’s trust. It is important
your children from inheriting the to understand that there is a statutory
money that they otherwise would. “look back” period which you must
surpass in order for the trust’s
Let’s utilize the example of “Rose benefits to apply to your particular
Smith”, a fictional prospective client. circumstance. At the time of writing,
Rose has pension and security income the period is five years. Had Rose
of approximately $3,000.00 per month, gone into the nursing home within
and owns her home outright and free that window, she would have been
of any mortgage. Her home is valued subject to a penalty.
at $400,000.00, but she has few other As such, it is essential to plan as
assets. Rose knows that she wants far in advance of any major medical
to live in her home until her demise, ailment as possible. It is never too
but has a history of Alzheimer’s in soon to plan properly. As the above
her family, and wants to protect her example demonstrates, proper
major asset (in this case, her home) planning is tremendously beneficial
so that her children will have a nest to your loved ones, and can be
egg, and her grandchildren will be the difference between leaving a
able to go to college without taking substantial financial legacy to benefit
out student loans. Rose will nominate your family, or paying that money
an independent trustee (a trusted over to the government, or other
relative, friend or colleague), transfer unrelated third parties.
title of her home into the Rose Smith
Irrevocable Trust, and reserve herself
a little estate. Rose continues to live
in her home, and remains eligible for
the same property tax exemptions to
which she was previously entitled.
Six years later, Rose requires nursing
home care, and spends three years in
a nursing home prior to her eventual
passing. Had Rose maintained her
home in her individual name rather
an transferring her home to the trust,
her estate would be liable to the
nursing home for the cost of the care
- at $10,000.00 per month for three
years, $360,000.00. Her family would
inherit 10% of her estate, with the
nursing home taking the remainder
of the funds. However, because Rose
utilized proper planning, the home
passes outside of her estate, and her
creditors cannot collect against the
house.

Ruland Funeral Home - Page 39