Many people believe that estate planning is only for people who are particularly wealthy, have elaborate schemes in mind for passing their money to their heirs, or for people who are acutely ill and contemplating their death. This could not be further from the truth!
If estate planning is the process of designing a playbook, estate administration occurs when the playbook is put into action. The process begins with an event that triggers a provision in your estate plan, such as incapacity or death. The plan becomes ‘executory,’ meaning that the individuals you designated in your plan documents must step into action and execute according to your instructions.
One currently-effective planning technique is to transfer assets into a ‘Medicaid’ trust. In a Medicaid trust, the trust maker retains the right to all of the trust income for life while irrevocably giving up the right to receive or benefit from any of the trust principal. The assets in the trust are not available to pay for the cost of the trust maker’s LTC.