Estate Planning vs. Elder Law: What's the Difference?
I often get asked this question when I meet a new prospective client or another professional for the first time. Many people assume estate planning and elder law are the same thing.
Let's start by explaining what elder law isn't. Elder law is not preparing Wills for old people! While elder law attorneys do prepare all estate planning documents, such as Powers of Attorney, Wills, and Trusts, the practice of elder law far exceeds these traditional estate planning components. To put it simply--estate planning is a plan for death. Your plan dictates who will receive your assets when you pass away, and how you will distribute said assets to those beneficiaries accordingly. Elder law takes that plan further and accounts for what happens as we live, and age, and potentially need to explore long-term care options before we pass away.
Not all estate planning attorneys practice elder law, and in fact, many are unaware of elder law planning strategies, or even when elder law attorneys can help. Unfortunately, putting faith in an attorney who is not well-versed in elder law can result in an expensive lesson for a person or family to learn--possibly to the tune of paying $10,000 to $14,000 per month in a nursing home out of his or her own (or loved one's) pocket.
The question left unanswered in the common estate plan is this: What happens if I spend everything I've ever worked for in a nursing home before I die? Your Will is useless to protect against that very important question that is becoming increasingly riskier and more expensive every year you age.
Research shows that roughly 70% of people who reach age 65 are at risk of needing some form of long-term care in their lifetime. Long-term care encompasses everything from adult daycare or short-term rehab to in-home care, assisted living, memory care, and nursing home care. These costs are ever increasing, leaving more of your hard-earned assets exposed to paying those costs. Annual costs for nursing home care in our area can range anywhere from $100,000 to $150,000 per year.
So why do so few people take the time to seek out an elder law attorney?
The answer is straightforward, although quite ominous--very few people are aware that the risk of long-term care expenses will likely apply to them. And fewer still are aware that there is anything they might be able to do to protect themselves from this threat. No one wants to end up in a nursing home, nor talk about the possibility!
Elder law attorneys help families plan to protect their assets from long-term care expenses. And even in grave situations where a family is already facing a loved one moving into a long-term care community, or a move is imminent, elder law attorneys understand the strategies that can be used to maximize what a spouse or family is able to protect.
Think about some areas in which we regularly applaud our professionals for saving a dollar:
Taxpayers rely on accountants to minimize their income tax exposure to pay less to the IRS.
High-net-worth individuals work with tax attorneys to reduce or eliminate their exposure to pay federal estate taxes.
Shouldn't middle class families have the right to protect themselves from the biggest threat they face, that of going into a nursing home and spending every dollar for which they ever worked?
How many families have worked their whole lives and decided not to go on vacation every year, or purchased used vehicles instead of new vehicles, all in hopes of not outliving their money and/or wanting to leave a "nest egg" to kids and grandkids? Those sacrifices may be in vain if the biggest threat to their livelihoods--an unanticipated health crisis--wipes out everything they saved.
If these are concerns you have had yourself, or you know someone else with these worries, and you want to learn more about options available to your family, it's not too late. Give us a call to schedule a complimentary consultation.