The terms “elder law” and “elder care” have become popular, catchy phrases people now use, to describe an array of planning techniques that are available to people as they age. Very basically, elder law planning involves having the proper legal documents, such as a will, health care proxy, living will and durable power of attorney. The purpose of these documents is to protect oneself in the event of disability and death.
In fact, the health care proxy, living will and power of attorney are probably more important to have than a will. Why is that so? Because if you become disabled and you do not have the proper documents in place, your family will likely wind up in court, commencing a guardianship proceeding to have you declared incapacitated, and to give them power to make decisions on your behalf. It is certainly not an easy, inexpensive or desirable process. If you die without a will, the only consequence is that your assets then pass according to the laws of intestacy and the family member who decides to begin the process of going to court to be appointed administrator may be required to post a bond. Of course, having these documents gives one control–i.e., you get to choose who makes your health care decisions, with parameters spelled out by you, who gets to make financial decisions, and upon your passing, where your assets go.
Elder law usually also refers to the process of becoming medicaid eligible, in case you should ever need long-term care, whether it be at home or in a facility. The process should ideally be undertaken at least five (5) years prior to one becoming ill, and it be must be done while you are of sound mind. There are various ways to dispossess oneself of assets, but one needs to be extremely careful about this, and a competent elder law/estate planning attorney should first be consulted. There can be quite substantial, adverse tax consequences to giving assets away, not to mention the loss of control and the danger if the recipient is sued or goes through a divorce. Generally speaking, transferring assets to a trust is a better option. It is especially important to remember that any transfer of assets within five (5) years of one needing care can have serious consequences.