How do you decide if you should start a draw down on parents savings/investments?

Like I just told River, Wills are for "what if". Medicaid told me they are pretty much null and void once you are using Medicaid to pay for care. First, you should have no assets when your approved. If like me, there is still a house when the person dies, that will need to be sold for Medicaid recovery. Yes, Medicaid has to try and recover as much as they can, its a law. TG my Mom was only on Medicaid for 3 months. They got every cent they put out when the house sold.

I do not know which state your parents are from, but in New Jersey there is a 5-year look back if you are planning for your parents to go into a Medicaid SNF. Every penny of your parents’ money must be accounted for when Medicaid requests the records of your parents’ income/resources. My daughter works for the Medicaid program in my state and when she requests all financial statements, including trust funds, if these documents are not sent in a timely fashion she denies the claim. Also, if she sees a red flag with the account and she asks for documentation of how the money was spent and she does not get clarification of why the money cannot be accounted for, she has to end up denying the claim for Medicaid.

My advice to you is to seek the advise of an elder law attorney before doing anything with your parents’ money as this can potentially prevent them from getting Medicaid if you cannot produce the record of how your parents’ money was spent.

My husband and I created a trust 2 years ago (he's now 67 and I'm almost 65 but we are both still running a business, so still working).

We made it know to our 3 sons that the point of the trust is to:
a) preserve our savings for our own care first and foremost
b) protect our money from ourselves should one or both of us develop dementia, preventing us from falling victim to scams (which is a sadly very common problem)
c) help qualify for Medicaid maybe
d) if there's any money leftover when we finally both pass, it goes to who and what is specified in our Wills

Please leave the trust money for your parents' care. Care is incredibly expensive.

JoAnn29 is correct that Medicaid will scrutizine where your parents' money goes if they apply. I can't imagine the trust is written in a way that would allow this, anyway (ours doesn't allow for this).

Also FYI in most states Medicaid only covers LTC which means a recipient is bed-bound. So, one has to qualify in 2 ways: medically and financially. A doctor has to assess a person as needing LTC.

Marie
Maybe some were a little blunt but what you and siblings would like to do actually will make it hard to place your parents. Why? Because Medicaid considers what you want to do as a "gift" not that you r getting your inheritance ahead of time. Medicaid does not even allow where the IRS allows gifting 17k a year. So what happens if you were to do what you all planned to do, there are penalties. Until those penalties are met, Mom and Dad don't get into a NH unless their children private pay. That Trust, it was done within the 5 yr look back. Medicaid may ask that it be reversed and the money used for parents care.

This forum helped me when I started caring for my Mom. I learned about Medicaid from the members here. You need to be very careful how you spend your parents money. Receipts must me kept. Moms bank statement was my proof. Showed the money coming in and going out. If I paid for something for Mom out of pocket, I wrote myself a check at the eom. I put the receipts in an envelope with the month and the check# on the front. When you apply for Medicaid, u supply 5 yrs of bank statements. (Some states less) and you need to know what any large deduction they may question is.

If parents have a home, it is an exempt asset but there will be no money for upkeep. Psrents SS and pension will need to be used to offset there care. If you or siblings cannot afford upkeep, the house will need to be sold. That money goes to Moms care. With me, Moms house did not sell before her passing. What happens then, Medicaid placed a lien on the house after her death and when it sold the lien needed to be satisfied.

The only way you will be able to "save" your inheritance is if you and siblings do the caring for your parents. POA does not mean u do the caring.

You really need to find out how Medicaid works and what u can and can't do.

Everything you do as POA needs to have meticulous records for their care only. Failure to do this properly will affect Medicaid assistance acceptance. About the trust, when in doubt consult a different elder attorney. Also ensure that you pre spend funeral arrangements. Legal and funeral are acceptable expenses. You already have a gut feeling that they might outlive their money so those early expenses may spend down earlier but it will be well spent to relieve your future anxiety. Ask the financial advisor if he has a template to follow. Massachusetts has a downloadable conservator form that is simple to follow and all entries will balance.
From this point, if you have questions from greedy family, it is best to not share information if you can do this. You can remind them if they continue with badgering you, you will need legal help to respond to them which will further affect their inheritance if anything is left.

I'm not going to berate you but from what I get is that poa is so that you make decisions within the best interest of the person/s you have poa of this means not withdrawing a certain amount to put away with the intentions of not actually using on said person/s who you have poa over also if you do go down the line of needing to place the people you have poa over into more intermedate care and do not have the finances for said care the place you are trying to put them in might do a finance check on the person/s you have poa over and these finance checks can date back years which means you would be landing only yourself into trouble if they found out you have taken finances which where intended for yourself without reason so my take on this is just because the money is there and that you have poa does not give you the right to withdraw funds for yourself or family that you don't have poa over you should not be doing that and if your family has suggested to you to do so you need to really find out what poa means there are certain laws you need to consider and abide by I hope this helps please google poa and the laws of what you need to do when being a poa

Oh my goodness! You people are the most judgmental group of people. I guess I had the wording wrong about draw down and stuff. I thought this was suppose to be a supportive group. How dare ALL of YOU! I am struggling with hateful parents, greedy siblings and being thrown into a horrible situation, with my own family issues.
You don’t have a clue and instead of being helpful- you judge me, call me names, wish me into hell. Thank you but my life is now a hell and I am trying to do what is right.

Thanks but no thanks.

No one gets inheritance until after both your parents are dead.
The money that they have put away for their "old age, their golden years" should be used to provide the quality care that they deserve.
I personally have a very dim view on people "hiding" assets to allow taxpayers pay for care that could be paid for. And I am sure that the care that they could pay for is of higher quality than what they would get if they were on Medicaid. (and most places that accept Medicaid want at least 2 years of "private pay" before subsidized payments kick in)

I don’t want to shame anyone but I am so sad to read this post. I am also POA for all for my 95 year old dad. I want him to get the best care he can and it’s his money! He worked hard for it, owning his own business for 54 years. I am really not counting on an inheritance, and am okay with that. He deserves to get what he needs and be comfortable. He is unable to stay in his home unfortunately, but he has a private room in a nice facility. I like to think that my kids will respect me enough to do the same. Please rethink this.

I would use the money for your parents’ care . It is THEIR money until they die . IMO there is no inheritance until both parents are dead ( that is IF anything is left ) .

If your parents wanted to gift you money before they died , they would have done it years ago .

IMO trusts hurt the elderly , but the lawyers and financial advisors make money setting them up meanwhile these elderly don’t know exactly how it works . They get some sales pitch about how you don’t want the nursing home to take the money .

Perhaps if your parents knew what you were planning they never would have set up a trust .

My own father in law fell for it at an elder care lawyer last year . Paid $6,000 to the lawyer to draw up the trust papers . The guy is not going to live 5 years . He totally wasted $6,000. It was disgusting that this lawyer encouraged this when my father in law was already in terrible shape. 19 months later probably looking at hospice soon .

What do you mean their money is 'taken'?

Their money is supposed to pay for their care, wherever that might occur, until it runs out.

You want your inheritance NOW against the possibility that your folks won't need their money for care?

Wow.

And inheritance is not a given--it's a 'possibility'. And it's tacky, to say the least, to take it when your parents are still alive and needing care. This will come back to bite you, hard, if the time comes and they needed that money.

Not to say people don't do that all the time--doesn't make it right.

We stand to inherit a pretty sizeable amount of money when/if my MIL ever dies. HOWEVER...every cent she has is currently being earmarked and used for HER CARE. All 3 of the kids would have MUCH PREFERRED that MIL's money had been used for her personal care in a lovely SNF.

So maybe, if she dies someday, they'll all inherit a sizeable amt of money--none of the needs it, all 3 WISH she would move herself to FT care, as opposed to the nightmare we have been living.

The words that jump out at me are "their money". That's what it is: THEIRS. And inheritance is not guaranteed.

And people will surprise you and live far longer than anybody could imagine. The costs of EOL care is significantly more than a simple ALF with them living fairly independently. You need to take stock of that.

If you "gift" yourselves your inheritance early then if they don't have enough remaining money to fund their care until the 5 year look-back expires you all will have to then finance their care yourselves because Medicaid will not approve their application. They planned to have sufficient funds to not be a burden on you and it is your responsibility to assure that the money is spent for their care. And they could live a lot longer than you expect. My dad is currently 102+ and still going strong. Five years ago his primary care provider said I should be prepared that he would die at any time as he was losing weight, etc. Now, we all just assume he'll live forever.

What in the WORLD?
Your parents investments is for THEIR OWN CARE.
WHEN you draw it down is for WHEN THEY NEED IT.

Your siblings cannot get their money unless you do some really questionable "semi-legal machinations that are in my opinion morally reprehensible.
As POA, considering doing this to "enrich" your family is entirely illegal and a breach of your Fiduciary duty to your parents. To say nothing of your moral duty.

I would be ashamed of such behavior in my siblings. As my brother's POA and Trustee I would have read them one heck of a riot act.

They would impoverish their parents to the extent they needed LOOKBACK (translate you are considering Medicaid for them, and Medicaid facilities instead of a good ALF or MC) rather than use the funds they saved for their care ON their care? There has to be a special place in Hades for such behavior; it's enough to make me wish I believed in such a place. I find that morally despicable behavior.

I hope you don't have some horrid attorney who wants only to get you all a bang for your buck, instead of protecting your poor parents. But given our times I cannot hold out a lot of hope on that one.

I honestly wonder at your asking us this question, when your Fiduciary duty and Moral duty imho is to protect your parents from graft and corruption.

As POA, I spent "my inheritance" that my parents earned on THEIR care in top notch Assisted Living and Memory Care Assisted Living facilities until they passed, in order to AVOID a 3rd rate Medicaid SNF.

What's "right" for your parents is that their money be spent on private pay care for them. They can live to 102 like my uncle did. I hope they do.

Please speak to the Elder Law attorney who prepared their documents. Make sure s/he understands Medicaid regulations for their state.

You seem not to understand your duties as POA. Please get clarification--NOT from a "financial advisor".

Spend down doesn't mean that she gives the money away to her family. It means it is spent on her, she should be self pay until her money runs out then you apply for Medicaid.

You want us taxpayers to pay for your mothers care? NO, the money is to be used for her. If there is nothing left then you and siblings get nothing.

You want her to sit in a Medicaid facility with 2 to 3 a room, TV's blaring, screaming and more when she has money to be in a decent facility and well cared for.

This is sad.