Estate Planning & Elder Law Hour - 5.5.18

Saturday, May 5th

 believe that Estate Planning is here to give you control over who is in charge of taking care of you and control over how you take care of your family after you are gone.  Without proper planning you can lose control and your family will not be able to take care of you as easily, or you will not leave your estate for the benefit of your family according to your wishes.

I had an experience in my own family where during a crisis, we lost control over where my grandmother was going to receive care.  This caused my grandparents in their last years to be separated by a long distance after more than 60 years of marriage.  I believe that my grandparents have drawn me into the field of estate planning and elder law to affect the lives of my clients so that they can have a different experience at the end of their lives than my grandparents did.

I place a special emphasis on protecting the assets of aging loved ones and educating families about complicated laws and the best options available to them.  I am passionate about helping others preserve their money, avoid probate, and achieve lifetime estate planning goals. 

I started my post law school career working for a large financial company helping financial planners with advanced estate planning and tax planning. I utilize this financial services experience to bring a different perspective to my estate planning and elder law clients.  My number one priority is to educate and empower clients to make the best decision for them and their family; there is no one way to do things.  I strive to give clients options and let them choose which direction they want to go.  I like to say, “If you don’t ask yourself the right questions, you never get the right answer for you and your family.”


Transcript - Not for consumer use. Robot overlords only. Will not be accurate.

This is the estate planning an elder lauer with skip Reynolds. Are we dive into wills trusts powers of attorney and so much more now here's your host skip Reynolds. Hey everybody welcome to the estate planning you know realize our with me skip Reynolds hopefully you're having a great Saturday so far. Really appreciate you list in this afternoon. Hopefully we have a good show for you but it just is a reminder and I say this every week at this time if he if you're a loyal listener thank you so much for being a listener he may be here me for the first time. Estate planning an elder a lot hour the reason and I do this show is to try to give you folks out there. More information more knowledge so that you make better decisions for yourselves and for your family. Because I think often times people look at estate planning it's just a necessity something we must do we've been told we need a power of attorney. We've been told we need a will or whatever it might be that you heard through the grapevine. But. Sometimes estate planning is more than that. What I found so many people make decisions based on half facts are half truths. And they think it is the 100% truth and they make inaction. And then we find out later typically when we can't fix that action. That that action has caused a negative repercussion that was worse then what they were trying to avoid. Because what estate planning really is is it's about letting your family take care review the way you wanna be taking Kara when you're not well but still alive. In how you want to take care your family after you're gone whatever that may look like for you and your family. An analogy that I talk about quite frequently is estate planning is the sweater that sweatshirt or the light jacket that you take on vacation to Hawaii. You take it why. Just in case that's why we do ST planning nobody wants to think about. Death dying being sick being in long term care that's not something that we wanna think about dwell on every single day. But it is a reality that could happen for us. And death is definitely something will happen every one of us so we should be planning for it so that things work out the way we want. And every family's got a different version of that. And that's why TV show so that you make better decisions of the you have a better plan. War it just in case. All right so I wanna talk about today when it kind of talk about a couple of different things a wanna start off talking about digital assets. Now when I see that a lot of people say well what the heck is that don't have any digital assets. But actually we do. And more and more states including Colorado we just got on board with uniformed usual asset protect her asset act. Here in 2016. And what it is is we do you have diesel assets now. On you have passwords you've got email accounts you've got bespoke Twitter whatever social media you may use if any. You've got I clouds where your pictures are stored you've got other places where things are stored digital information. I read something here recently that in the last year. We have saved more digital information. In the world then we'd saved in the whole world combined. Prior to that. It's amazing the explosion of digital data. That is out there in the world and it's only going to keep increased tenfold I mean it's it's growing every single day. Most most people have everything saved to the cloud and other pictures it's so much. Other big key deal that we need to have planning inside of our planning war. So. Just to kind of give you this scale of reference. And it still kind of mind boggling to think about digital assets because we're. For most of us were used Hugh Hart thinks right where we're used to use the teen doable object and it has some value. So went to continuing education a couple years ago and the present or was talking specifically about diesel assets. So he's euros up on the screen a picture of a sore. And this sort was from you know some British war. Hundreds of years ago. And the value of that sword lose somebody bought on auction I think it bought it for something like 5000 dollars. So pretty valuable a sword for 5000 dollars right then he throws up a picture of the sword for a video game. It was a one of a kind sword for this specific video game and I don't recall which video game it was. But it was a specific sort in some individual had purchased this soared to use in this video game so he was the only one they had it. For 20000. Dollars. He bought a fake sword in many of us and many of our eyes for 20000 dollars first is the real sword. For 5000 dollars. But then the prisoner goes on any throws up a picture of but would look like a coliseum like the Roman coliseum. And in this coliseum. Gamers are people who play video games could. Bring in their character. And fight against other characters kind of gladiator style. So this individual purchase this. Coliseum. He took out a second mortgage on his house for a 100000 dollars and he purchased this. Meanwhile gamers are paying him so they can't come in there and fight their guys against each other. He held this for two years. And he sold for 600000. Dollars. So we bought a digital. Coliseum. 400000. And in two years sold it. For 600019. A 500000. Dollars on his investment. Now it's a little hard to imagine that it digital asset could be worth a 100000 dollars but obviously it was. Or 600000 when he sold it. Because it's not a teachable thing I mean the way I talk about is what would happen if the Internet turned up tomorrow. You have nothing that a 100000 dollar mortgage against his house. But it had value. And this intangible inanimate object had value. To him into others. Out there and we've got to start planning for this stuff. And it's not something that most of us are even thinking about or considering. As a part of our estate plan. So one of the things is if you have the power of attorney if you have a will if you have a trust it's over a couple of years old. There is a high high likelihood. The you have nothing in that document discussing what to do or access to your digital assets. So for example. I TTE into an email to retrieve emails. That we might need or T retrieve that iCloud has all of your pictures because you haven't given me that power. And depending on what it says in mid terms and conditions. Of that company. That you signed off on and I'm sure you already right 'cause we all read those terms and conditions. Even if we did real most of us wouldn't understand them to be honest they're they're really convoluted us attorneys like to write things in backwards talk. But even if you could read it and you did read it the devil's in the details any keeps on changing all the time. But we want to make sure that your decision makers your power returning your exact order yours your will your trustee of your trust have access to this information. If you want it. To include. Turning these things off even if there's nothing in there that you want them to access. So. Certain companies have different rules around all of this on some of you out there might have Yahoo! emails. I Yahoo! is notorious for having. Pretty stringent rules about what they do when they find out when somebody's done dead. And typically they're rule is we turn off the account and you can't have access to it. So that same present tour at that continuing education gave an example of one of our military members. Who. Was overseas. And had said to his parents that if something were to happen to him that he would like them. To retrieve his emails that he gets into you down and other close friends and relatives. During his time. Overseas serving our country. And put that together in kind of a scrapbook. Problem is is he had a Yahoo! account. So as soon as that the only called Yahoo! said her son passed away in Afghanistan or Iraq. Debt. That shut off the account net shut off their axis they could not do what he wanted them to do. And so would end up happening is that the only actually QB Steve process. Had to subpoena. Yahoo!. To release. That information to the family. So talk about having to really jump through some hoops to access something that their son. Had said was very important forehand to have kind of a record of these correspondence is with him prior to his death in war. So Colorado here and it has adopted this uniform digital asset its. Law. But. In order further your decision makers to get access to this stuff they need to be give been. The specific authorization. Within your power return with senior will within your trust if you have one. But you can do some things to try to make it easier for them once we've gotten that language inside of those documents. Some of the things that you could potentially do you can create a list of accounts. And designate which ones you want to keep and which ones you want to delete. Now why would we want to delete Sami keep some well. One of the one of the battles and one of the issues here and it's been well settled with paper work. But not as well settled yet with visual accounts is. Just because you're gone doesn't mean that you may not want some things you remain private. Sometimes I think we think oh well they're gone in and privacy is kind of out the window. Not necessarily. At least from a legal perspective so. By creating a list of OK you can just go ahead and delete everything in this email or. These are the only specific types of emails that you need to pull from this account. Such as you know maybe you've got reminders of when bills are coming up or something of that nature that would be very helpful. On for your family members including your decision maker. To know that so that they can access what they need to access before they turn off these accounts. Whereas you know like for example he's myself you know we use this that apple iCloud for pictures. And many people uses Google cloud for their pictures or other stories information. They need to know how to access his C need to know that this is something that's important for you to go out there. FaceBook. A lot of us have FaceBook these days even even though grandparents often times out FaceBook. Because they may not be posting a whole lot but it allows them to easily follow what's going on with the grandkids and with their children. So. What do we do with those accounts when he passed away I still have. A cup couple of friends that I've got a family member who has passed away and they still have FaceBook accounts up there. And everyone's on there on the that feed I'll see this somebody's been posting on their their page saying happy birthday or whatever might be even though. They might be 235 years. Gone. So it's been an interesting deal and in the if we want to turn those things off we need to give people access to that so that they can turn those things off in do we want them to turn it off. We can tell people all of those things. The other thing is death in this is problematic for most of us these days if we're using computers very much is. We've got a million passwords in a million user names in. She I can't even remember a mall half the time is a sometimes I have to be prompted in change it to something and it. On might know well. How do we give access to our loved ones of this stuff because we don't wanna put it in your will we don't want to put it in your trust because. You know beings can change frequently obviously but the other thing is in particular in the will of the will is a public document if we go through probate. And we don't want your passwords and user names to be in a public record is kind of like just. Give everybody years a year year access to everything or you know your Social Security number right. And so how to we how do we give our loved ones access to these scenes book keeping them Friday. So that they can get into these scenes and deal with the need to do with them. So there are all kinds of different what I would call password management software programs. Where they just need to know one password and then making Guinea and and all of your lists are there now the key to it. Leahy everything else in in what I do is is keeping it up today it's the maintenance of it. Because more and more on finding even with my own accounts that after a certain amount of time I'm being prompted to change passwords. All it if you had a pastor for more than a few months six months twelve months whatever might be. The company that has that account may four she did change your password periodically. So that they can. You know make sure that this stays safe and somebody doesn't it into it is all about security risk. Well you've got to maintain that so even if you have the password software management system. You've got to be going back in their periodically go I changed my Yahoo! pastor I need to go back in there. Is if you haven't updated that and I getting into a listing on your son. I can't do anything with that count because it's not the right thing. So now I've got to go the hard Ralph which is contacting. The whatever company it might be. And going through whatever process they make me go through and hopefully you've given me access that information inside of your state plan if you haven't. The door might be shot on me. And I may not I might not be able to access that information. On a miseries of the year recently Google accounts on many of us have Gmail many analysts have other kind of Google accounts. Google has amassed that in I haven't looked into it but I I'm going to do so even for my own self. Is they have a method in how you can deal with that account if it hasn't been used where specific amount of time. So you can say okay by having uses Gmail account. Having access it logged in whatever four X amount of time say six months twelve months whatever might be for you. You can tell Google what you want them to do without account. You want them to you for all the information to a different team now you want them to you turn it off whatever it might be their options there for you. I I need to look into that or myself. So the whole point of this portion of the show talking about the usual accounts. Is to gates you'd think that you do you have these six. Not everybody does but most of us these days have some form of digital. Accounts. Whether me beaches and email could be social media. Could be that's where you keep your pictures. Or storage files and things like Dropbox or Google dot drive war whatever it might be for you. This is real folks and it's only going to increase it if you do not have it in your planning. You'll work. BM remembers your decision maker on your power return you will your trust if you have one. May not have access to this information. May not be able to go get all of those pictures a view in the grand kids have you and your kids. A viewing your spouse if you're married or you standing at the top of a mountain in celebrating that you hiked up that whatever it might be for you. They may not have access to that sued the history of you in particular with pictures. May be somewhat lost because unfortunately. Most of us don't go to. Wal greens anymore. And print out our pictures very odd it's all on our phone it's all on our cloud. And and we need to access that stuff folks and we need to be able to deal with that. And one last point is most of us now have Smartphones. There are still some people to have what I'll called dumb phones right where it's a flip phone in doesn't have. All of the Internet no other kinds of access but those of us have Smartphones. How do we get an do you have a password. On I've got an an Apple iPhone. I have a password bulb does anybody in my feel we know that password to get in so that they could do without account. So it's a really interesting topic area. We need to address in people's plans if you want to address it in your plan and be happy to sit down and review that stuff with you. I just kind of as a reminder I do do you public workshops talking about outside an additional assets in the in nature that I talked about today. But I do talk about all types of different. Steve planning topics. And so it it's important to be learning all of easings if you wanna come to one of these workshops I've got one here in May. And I've got this this one is on the twenty seconds of may at the south Glenn library from one to 3 PM. So if you wanna come on that teasing the 22 of may anyone here not a seat planning maybe I'll talk about some things if you've got to plan. Maybe you've got everything you need that come in and listen and see if there's an idea but true that I bring up that maybe you hadn't considered in your plan. Or if you want to start your plan your welcome to come and then if after that workshop you wanna meet with me. You get an hour and half of my time for free. And we'll review your plan make sure that it's up to date the way you want they sure you've got the digital assets in their or not. Or did she started down that road to getting the plan that you want because maybe it's. Time or maybe it's been many many years since you've done your old plan. All right so. When I come back from the break I'm gonna switch gears now start talking a little bit about asset protection it's been awhile since I've talked about it. A wanna talk about what pre planning. Or asset protection can look like. In the event that you have a long term care events in your life. How can we try to protect. Any of those assets that you want to make sure are protected or even just give yourself more choices. How do you use that money into the future so when we come back we'll talk about that stick around. This is the estate planning an elder lauer with skip Reynolds. We dive into wills trusts powers of attorney and so much more now here's your host skip Reynolds. Welcome back everybody TC planning an elder law hour with me skip Reynolds thanks so much for joining me this Saturday afternoon really do appreciate you listening. Whatever you might be doing out there whether it's driving around working in the garage working in the yarder religious. Loans and around the house really do appreciate you listening. So if you this is the second segment of the show if you missed any that first segment of the show. I was talking specifically about. Digital assets. Are emails are our social media are high clouds are there photos etc. If you miss CBS section showed you wanna go back can you wanna listen to it you can go to the crews in 1430 web site. On the trees at 1430 USA you click on. She goes they go to the weekend shows in you can look for the estate planning and elder a lot hour and it will be right there. Or if you want you go to my website at skipped into law dot com that's SK IP TO and law dot com. You can click on blogs and will drop down in the re you show. Icon will be right there you can find this show any of the past shows as well if you wanna go back and listen to this podcast. All right so I'm gonna kind of switch gears was talking about digital assets the first segment now wanna kind of talk about asset protection planning. So many people that come into my office. Are very keen to you want to try to protect their assets drama but I called the right hand turn with somebody's health. Where the unexpected happens you have the diagnosis of dementia or alzheimer's and you go that at some point. You're going to be lacking the mental capacity. And you're gonna need more help. Or maybe that day you wake up and you have a stroke and now you need long term care whether it's nursing home assisted living whatever it might be. Or even if you just go through the spectrum and eventually need that type of care. So many people are keen to wanna try to protect some of what they have built during their lifetime. From these type of high expenses because we all know that long term care costs are not going down dated date. It is going up. Everywhere here in the metro areas that average cost of a nursing home is somewhere in the neighborhood of EE 500 to 9000 dollars per month. And even if you're staying home and you're having 24 hour care a sock you with the client just last week. She has somebody coming in in home care. They're not. Giving her medicine but there helping her around there helping her AB. You know on and off the toy really helping her cook clean whatever it might be she has this 24 hours a day or or pretty much 24 hours a day. Is she spending about 8500 dollars a month. On this care. How we gonna pay for this and many of us may not want to use all of our resource is honest. And Minnie was me not have a whole lot of resources. To pay for this type of care so how do we make this work. How do we protect. What I called that which we want to protect which is our principal. Which is you know our underlying assets that's our house it's our our bank accounts it's our investment accounts it's our ire raise potentially. How we protect these things from having to be blown through or lack of better term. In the event that. You get sick your spouse gets sick if you're married how to we make sure that we have a little bit more control little bit more choice. As to what's going on. So there's different ways that we can try to asset protect. The First Lady we can try to asset protected in this is a joke is just don't get sick rights. If you don't get sick. Then you don't have any long term care costs to worry about right I think met many of us if we had our druthers. Would go a little long life a fruitful life a happy life and then die a very calm and nice death. Whether it be in our sleep or whatever it might be end and not have to go. Two assists a living nursing home etc. I'm sure if you were to do a poll of people that live in some of these places. And you were to catch them before. They need to be there many of them would have voted not to want to be there. Most of most of us want to have. If we need long term care we'd like that here to be in our home if at all possible. So don't get sick is option one. We don't have a whole lot of control about that one the second one is and I talked about this out link over the whole show last week. Is having some form of long term care policy. So if you wanna hear me talk a little bit more about my philosophies on long term care not gonna go into it again this week. If you wanna hear that you go to decrease of 1430 website. The state planning an elder law hour show will be there. Or you can go on my web site skipped in law dot com and you can find it under new radio show. There as well. So long term care just really fast I look at long term care as a way to slow down. The spending of your money in the event that one or both of you if you're married. Needs some formal long term care in the future. Because if you've got an additional resource I either long term care insurance to help pay for that 8509000. Dollar a month bill. We can slow the drain of your assets if we can get the dream of your assets from 8000 to 4000. Your money will in theory last twice as long. Makes sense right. So it another way that we can asset protect and and many people do this. On sometimes not understanding all of the ramifications but it is one vehicle to try to protect. Is that we give our assets away completely. Any we say here take a house here take this account. You are loved ones usually our children. We give them completely away. And in the fourth one is. How can we remain still in control of our assets but put them off into a place where they can be protect. So those are kind of the ways that you can try to asset protect you can just don't get sick you can have long term care you can give things away. Or you can remaining control and have in a place where it doesn't have to be used. Depending on your scenario. So. I wanna talk. You know that don't get sick obviously that was pretty self explanatory long term care I talked about last week again you can go back. On to either an increase of 1430 website and listen to that or go to skipped him on a calm and listen to it there as well. But I want to talk a little bit about giving assets completely away. I've talked about this many different times but I think it's very very important point and if I gotta keep talking about it I gotta keep talking about it so that you. Out there did. The drift and make good decisions. So we knew give these assets away. So if I give my house to my children by give my bank account to my children if I give my my money to mine. Loved ones. I now have zero control over that money. Where that asset. I call it non take a back double meaning I've given it away. And I can't take it back. If they wanna give it back that's another thing but I cannot force them to give it back to me. It's non take a bankable. But once we get these things away. There can be things that could happen to that because so it typically I'll CO apparent say give the bank account to their kids. Or put their kid on their bank account. Or give their house to their kids or put their kids on their house all with these eyes in mind T try to avoid probate. Or try to get asset protection so if they do get sick that Medicaid or it or the nursing home can't come after that money. And now that's a novel idea and I completely understand. Why you people would want to do this but. That's just Jesus example so let's say that my parents gave me their house. Their names are no longer on it right they give it to me. So that it's not one of their assets so that it can't be taken from them Bryant. Okay well who now owns their house. I do not now but who lives in their house they do. So play along with me here folks. I'm driving down I 25 go into you would say I'm going to Iraqis gain since rocky seas. I get into a car accident. In a car accidents like faults multiple accident multiple injuries potentially even somebody dies. My fault. I've got insurance right I've got umbrella insurance I've got you know my car insurance is typical T 5500. Or whatever we have. Out there these days. But let's say that somebody did the so now they wanna come and try to attach to my assets. Well what's one of my assets. Uh oh it's the house that mom and dad live in. That's owned by media now so now mom and dad's house could be tit potentially subject to mind liabilities. Right so if they attached to mom and Ted's house they could potentially. Do that mom and dad's money because of something that happened. Because of something in my life. Unexpected. Are so it's not super realistic that I have this bad bad accidents that we know that it happens out there. But what if what if I run into creditor issues I've run up credit card debt or what if I have a bankruptcy issue the number one. Bankruptcy issues these days is not credit cards. It's medical expenses. So I get sick. Not have that car accident let's say that it's not my fault but on the injured thumb in the hospital for three months because of whatever happened to me. Now got all these huge medical bills potentially. Why can't pay 200000 dollars with the medical bills but my gonna do. On the deep color bankruptcy OK we'll bigger CDC's is not what used to be. Where you completely got out of all of your debt now you still have to repay some portion of it. Well if they need to be attaching leans to assets to make sure that they get repaid. What's one of my assets. Mom and dad's house. Only cal did you consider that I just wanted to avoid. Medicaid come forward to the nursing home coming forward whenever we were I wanted to avoid probate right. So we made this action and we gave this the way non take a bankable. Not quite realizing all of the potential ramifications. Of that decision. The other thing is depending on what type of Bassett the U giveaway. That C give away a stock you bought years and years ago. Or ten dollars this year and now it's worth 200 dollars this year. Well that a 190 dollars is what's considered capital gains. Well you can give me this stock. But the IRS looks at it as if I had a bit your ten dollar. Cost basis is what they call not the 200 dollars that it was worth when he gave it to me so when I go to sell it at some point down the road. Even after your death guess what you handed me. He's handed me a capital gain on all of that growth in net asset. Whereas if you elected to be through. Your will your trust a beneficiary designation. When you die now I get it I was told us stepped up basis so the 200 dollars that it was worth that your data death. Now only the growth from 200 on its subject to taxation. Or me. Seen here an immediate stock or or or most typical won his house you can't immediate stocky enemy this house. Because you wanted to avoid proving you want it's you not have to be taken if I get sick etc. Maybe not understanding that you may have handed me. Something worse than what you were looking. I'm I had somebody here recently that they gave way their house to try to avoid probate. And the capital keen to their loved one or that gift during their lifetime. Ended up being 60000. Dollars. Me it was a great appreciation. With the cost to the kid was a loss of 60000 dollars of value of that property when they sold it. After dad died 60000 dollars. Because he wanted to do avoid probate. I'll tell you right now Alessio contested probate you're never gonna pay 60000 dollars for a pro it. To avoid one problem we 'cause a worse one. And I guarantee you that dad never considered that that might happen because he didn't understand all of the rules. So it may have negative tax consequences in May have liability consequences. Oh by the way if you give it away. And you need to go into long term care and you run out of resource is. Medicaid can look back five years. And say oh boy he gave away this amount of money over the last five years. That's fine you can give it away but we're going to penalize you for that gift. So what they do is see say OK you gave away a 100000 dollars. We're gonna divide that 100000 dollars by what we think one month in the nursing home costs statewide. So right now this year that is 7828. Dollars. What Steve is saying. So there you divide that 100000 by 7828. And they're gonna come up with a penalty. A period of time in which they will say you're eligible for Medicaid but we're not paying. So for a 100000 dollars but by 7828. They're gonna say that you have approximately twelve point eight month. Penalty period meaning you guys got to figure out how to pay for yourself first twelve point eight months. TV giving these gifts you've been given 5000 here 101000 there whatever it might be to your loved ones. And over the last five years all of that adds up to a 100000. And now you have split down to whatever the Medicaid eligibility levels or for you whether it's couple or single. And boom. You're in the long term care you get away this money and now the county against you and where we come enough. With twelve point eight months of cost of care for you your kids. You know are we have to go to the Steve and big for forgiveness. I don't know. But we've lost some level of control. Because we didn't maybe understand the ramifications. And once you give it to your loved ones they can do it ever they want with it so if you give your loved one cash. Or anything of that nature it's non take a back couple. They could take it and go buy themselves a new car. And now that money is gone. And NATO have the money to give it back to you within if you have that long term care event. That would need you to pay say twelve point eight months of penalty time. To go before Medicaid will start picking up your bill. So we got to just keep all of this stuff in mind folks not only don't give things away. But before you give things away just trying to achieve one result. You know the old adage is you don't know what you don't know if you don't know all the potential ramifications before you make. Such inaction. You may be making a mistake that we cannot fix in the future. Or causes us new issues in the future if maybe we didn't even know where potential consequence. Or didn't even consider as we are making that because we are so focused on what we were trying to achieve. So if you wanna hear about that kind of thing in non take a back won't some of the ramifications. You're welcome to come to one of my free public workshops I've got one here in name only one. It's on Tuesday may 22. That the south Oakland library so that seemed. The kind of Littleton area over university. And arapahoe road is is close by. If you wanna come to this workshop is from one to 3 PM there itself than library on Tuesday the 22 of may. You wanna come you can sign up on my website skipped in law dot com click on the workshop page. You can go right there in register if you're not online inclined. You can call my office. If you wanna call my office on give this number again later if you wanna write it down maybe aren't ready yet. Not my office line number is 720440. 2774. He can talk to Stacy should be she registered we'd love to see it come now learn more about what asset protection potentially is where you. So when I come back after the break I'm gonna talk about how I do asset protection in my office. Where those clients that are looking for that type of protection to stick around we'll be right back. This is the estate planning an elder law hour with skip Reynolds. We dive into wills trusts powers of attorney and so much more now here's your host skip Reynolds. Welcome back everybody CDC thing you know through a lot hour with me skip Reynolds this is our first third and final segment of the show today CP misty neither previous part of the show you can go to the crews in 1430 web site. But for the C planning you know guerrilla our show agent he could find the podcasts there bring go to my workshop in her mind. Website at skipped in law dot com and you can find it there as well. So wanna kind of jump right back in. Is Burton running short on time today and wanna talk about how I do. This asset protection playing for those clients in my office they're wanting to protect their assets from their creditors and creditors. Main creditor predator than many people have on their mind is. I get sick. And I don't wanna spend every last dime that I worked so hard for during my whole entire life. To pay for this long term care thus leaving either my spouse somewhat impoverished. Or worrying about money. Or I wanna leave something to my children or I just don't want to spend it all because she I worked for it and this is not my plan for that money. So one of the things that I use in my office or a specific type of trust. And I call these shows I pugs which Ziff fancy word for. And you real viable cure green tour trust tree. What does that mean write it. Essentially means that he is a hybrid type of trust or asset protection purposes. So and any type of trust like most people have heard of any revoke Kubel living trust. Are vulnerable living trusts you or the person you need to trust we call that typically the grand tour of the set or. You are the person in control of the assets within the trust because this person the trustee. And in revoke we'll trust you are also the 100% beneficiary of all of the principal. And all of the interest or the income that might be coming from that principle. So the principal was your 100000 interest is the 5000 dollars of earnings. Revoke we'll trust you have access to all three of them us now if you have access to all three of those. So to do your creditors and creditors. Including your long term care costs because if you have full access and full control so to do they have the right to ask you to use it. So there is no asset protection inside of a revoke global living trust. During your lifetime in order to get protections with a revoke will trust one or both of you need to die. So then we look to your revoke oval trust well when I say your vocal trust most people. Red flags are going off in their minds saying no no no I don't want that because. When you put it in in your book will trust one you can't change anything about that trust. To you can't control anything inside of it and three you can have access to anything inside and you can not be the beneficiary. So most of us are saying whoa whoa I want control and I want potential access. So and you're able Coble trust is typically. Not an option that most of us are in Teresi did. So. What this I Pug is is it is kind of halfway in between. So with this trust. You can remain in control. Of the assets with in it. I eat you still get to decide how it's invested was stock she by what accounts you have in. You can decide to have your house in there if you wanna sell your house and go buy another one you can do that all with the inside of this trust. Because you re mean the trustee. If you choose to be. Oh by the way you can also have a rule book for who picks up. For the trustees ship if can win you can't continue this trustee any longer. So you really do remaining control now there are some of these asset protection trust. That still will allow you access to the income coming from those assets. So for those people that are may be looking for. More of a creditor type protection rather than a long term care type protection this might be a valuable thing. We can put assets in there we can continue giving you all of the income off of that asset. But the principal or the underlying asset itself is protected. And why is it protected. Because you do not have direct access to it it trust says you cannot have the principal back directly. Meaning you can't happen. But the trust doesn't say who you can give it to you. Because you're still in control used to get to decide who you give it to you. So let me use just so real world example not even have a trust. So many of us especially for parents or grandparents. Have. Money right some form of money and we may wanna give that to our children our grandchildren. And we get to decide. When we do that and how we do it and under what terms and conditions we do that right. Well with this I can't trust you still have all of those same powers. Because you're still in control of the asset if you wanna give it to the grand kids to help pay for a new car because they're going off to college guess what folks. You can still do that. Only person can't have the money back directly is you. So overall those rainy days that you're seeing in this money for the U wanna give it to the kids the grandkids for whatever purposes that you might have. Or any other things of that nature. You still control that factor folks with this type of trust but. Because you don't have direct access to the principal. Neither can your creditors and creditors get at that principle. So if we're talking body in a long term care scenario. Outside of five years so if you put something in today. And five years from today that NASA that is now off the radar from ever being accounted resource. Of York's. If it's inside of this type of trust. Seed remaining control in five years is protected from being on your balance sheet all call it. If you fall into a long term care type scenario. But. The thing is is. If you need that money we have choices about it if you have it just senior revoke we'll Dresser if you just have a senior counts. And one of you were both of you get sick. All that money is on the balance sheet that will need to be dealt with in some manner. Most often and not people they don't know other ways to deal with it just spend it it's do what's called a spend down. We stand in we spend and we stand until we're down to nothing and and then we go on Medicaid or on veterans. A new attendance pension or something like that if your veteran. But what this trust does in my book is that we can protect those assets that you once she protected so that. We keep some of it now. So that you have full access to that money but we look at that money has a potential loss. If something happens this money may be lost but we put other portion of your state into this type of trust remain in control of it. Remain in the ability to access and give it to whoever we want. Other than ourselves. But. We can protect it. And then if you do have that long term care event and you run out of the money it's outside of it and let's see their program like Medicaid is awful. Mean that I really can't tell you where I think Medicaid's going in there's all kinds of different discussions but we haven't seen any real change yet. Let's say the Medicaid's awful you can't find you good place to live what guess what folks. We now have a choice of whether to use that money in that trust or not. Whereas if you how did you senior revoke Coble trust Ricky Hatton just in your accounts. Are choices are now different we must use it right. So now we can use it or we can't use it depending on. What is best for us see how they gives us some additional choice that maybe we would have had otherwise. Oh by the way all the wild until that time frame. We remain in control of it oh by the way we can also put in that trust what happens to those assets if we don't ever need a let's say we just die. We can have our rule book for how it passes to our loved ones. And under what terms and conditions if any that you wanna half. So we can have a lot of power. With this and control over what happens both ball were here. And after we're gone and if and when we did decide that we didn't wanna access sit. We access it through our family. We give it to them or they give it to themselves if they're the back up trustees. And they can use it to pay for things for you. But we're not mandated to use it in the same way as if it was just in our hands. So it gives this more could control and choice if and when something happens to us now. The one asset. They can never going to this type of trust and he can't go even into a revoke Coble trust until you die is our retirement money. Our IRAs are 401 k.s are rock diaries etc. That money that has not been taxed yet or it's been taxes in a qualified type of account like your Roth. Cannot go into a trust until you die. So I'm not gonna jump on my soapbox yet again on the higher res stuff but. Until you pay uncle CN this year I cannot help you protect it from your long term care costs. It will be on the balance sheet. So I'll have people coming in my office they've got a 750000. Dollar state. And of that 750000. Dollars Davis say they've got 350 in IRA money. And then they've got equity in their house of a couple of hundred in May be a 100000 in the bank in and other investments. So half of their Steve easy you know fashion that cannot be easily protected. But the other half can't be there house. The house is the number one asset that many of us can look at asset protection for. Because we can continue to reside in it became millionaires on his want to we want to sell in turning to cash we can't but guess what now that cash is protected. From. Any of our potential long term care costs on the road. Are we wanna buy a new one we can buy we buy with a trust with the money from the sale of the first house. We're doing all these actions as the money control over the trust who recalled a trustee. And we can try to make this house never and endure the value of it never have to be included. Towards your eligibility for the program such as Medicaid. Now. We can't exempt your house. And super John Medicaid. But. If you are married and the person and easy go indicator. Doesn't die first now the house is at risk. Or if you're single. Now to pass house is that risk they're not gonna take it from you while you're here. But they will potentially coming take from it when you're gone. If you wanna have a little more control little more choice over what's going on with that asset. These asset protection trust could potentially be a vehicle for you. And it's the best vehicle for those of beauty that wanna protect the value of that house that equity that you built up inside of it. If you have your house paid off. That's where it's even stronger. So if you have a house that is paid off and you would like to know what asset protection would look like for you. As a preteen see that house in any other your other assets. And how we potentially could give you and your family more choices of how to use your money or not he need that you need long term care in the future. You can come to one of my workshops coming up on Tuesday made a 22. At the south Glenn library from one to 3 PM south the library. Is on the court and near the corner intersection of arapahoe and university. There in Middleton or Centennial it might be. Com listen to me talk about asset protection all these other types of things and then when you come in to meet with me. Let me know that you wanna talk about asset protection specifically and will run through the numbers and what does it look like for you what could we potentially protect. And give you and your family more choices over what happens with your resource is in the event your health takes out right hand turn. All right so. If you wanna come to the workshop you can go to my website skipped in law dot com. Click on workshops you can sign up right there or if you have your pen and paper out in your ready right this down. You can call my office and talked to Stacy at 7204402774. Issue PG signed up for that may 22 workshop we'd love to have you come out. Even if it's just a review of what's going on to learn some new things. Endorse sit down with me and review your current plan if you have one or even start one if you don't. So wanna thank everybody for listening in today are really do appreciate your time hopefully got something from the first segment of the show where I talked about digital accounts diesel assets. It's something many of us have never thought about as a part of our state. And then the last two segments in the show was talking about ways to try to asset protect. And in particular this third section talking about the type of trust that I use in my office to help my clients achieve asset protection. So thanks so much for listening in this week folks really do appreciate it does you're loyal listeners think you so much does he might just Herbie for the first time. Hopefully you'll tune back in. Have a great rest you're Saturday have a great rest in your weekend and a fabulous week tough team except. Thanks for listening into the estate planning an elder lauer would skip Reynolds. Tune in next week where we talk about some great new topics this is the estate planning an elder law hour with skip Reynolds that's every Saturday from two to three on cruise in 1430. You can Reynolds is a licensed attorney in Colorado all of the stories and content of this state planning an older life hour are not intended to be direct legal advice here for illustrative purposes only additionally new attorney client privilege has been performed with the law officers have been Reynolds LLC we're still in Reynolds Esquire where to seek legal counsel before making any estate planning or elder lob city. All of the views of the guests of the show are their own and are not views of the law offices in Reynolds LLC or skipping right over Esquire. Nor is there appearance and endorsement of goods or services for the law offices of have been Reynolds LLC was it to Reynolds Esquire.