Life Estates

There are two different types of life estates. The first is called “life estate with powers”. A life estate can allow a person to live in the home while transferring eventual ownership to children, for instance, when the homeowner passes away. The “life estate with powers” gives the owner the right to change his mind if he decides he does not want to leave the property to the individuals named in the deed, or if he wants to sell or otherwise dispose of the property before he dies. Simply put, the term “with powers” means that the homeowner is not giving up the potential to exercise full power over the real estate by changing his mind.

The second type of life estate is known as “without powers”. That means that the life estate transferring eventual ownership to someone else is an irrevocable transfer. That is to say, unlike a life estate “with powers”, this type of life estate does not allow the homeowner to change his mind once the life estate deed is signed.

Because of these differences, a life estate with powers would appear to be the best way to go. However, there is a glaring exception. And that is if a person contemplates being on Medicaid, retaining a life estate with powers would affect the person’s eligibility for Medicaid. That is so because the real estate would be considered an asset of the Medicaid applicant since he has ultimate control over the real estate. By contrast, a life estate without powers, since it is an irrevocable gift, means that the only ownership interest that the applicant has is the right to live in the property. The value of that interest is considerably less than, for instance, the power to sell the real estate. 

What is a Health Care Power of Attorney?

If you are unconscious and in a hospital, who will decide the medical care you will receive?

Typically, next of kin would serve in that role. But what if there is a difference of opinion among your loved ones? Who will then make the decision? If you have not made a selection of a representative or there is a conflict among your next of kin, the realistic answer is that the doctors will. You can avoid this result by signing a Health Care Power of Attorney which appoints individuals in the order of your choosing to make health care decisions on your behalf.

Who Makes a Decision When the End is Near?

A living will, or advance directive, is a document that allows you to specify what treatment you want and don’t want if your health condition is considered terminal or you are in some permanent irreversible condition and are, in essential respects, unconscious. You can direct that doctors do certain things or withhold certain treatment if you are in those conditions. That means that the doctors will be given authority to act independently of what your loved ones might wish – that might be good or that might be bad. On the other hand, you can leave the final decision to your loved ones through a Health Care Power of Attorney you have granted to them to make such decisions.

Do You Have a Power of Attorney? Is it up-to-date?

A financial power of attorney is a document which allows someone else to act on your behalf if you are sick or out of the country. This power can be used to pay your bills and access your bank account, for instance. When you hear the term “attorney”, you probably think of a lawyer (also known as an attorney at law). The term actually means “representative” and the power of attorney document allows you to select people of your choice to make decisions for you. If you don’t have a “power of attorney” document and necessary financial decisions must be made when you are unable to make them yourself, your loved ones or others will need to go to court to have a guardian appointed. That will result in needless expense, aggravation, and delay.

Are There Options to Nursing Homes?

Many people end up in nursing homes for their final years. But there are alternatives. With proper support and community involvement, it is increasingly likely that an individual in need of nursing home-type assistance can receive such attention while remaining in his or her home. Unfortunately, a person on Medicaid, under current law, will find it very difficult to accomplish that. However, if an individual has obtained long term care insurance which provides sufficient benefits, the policy can provide funds for nursing care and other care such as food preparation to allow the person to remain at home (also known as “aging in place”).

Easing the Stress of a Senior Move

Moving to smaller quarters after the children move out or retirement kicks in can be stressful and a pain…so many memories and deciding what you can’t take with you.

You can stage a garage sale and endure the hassle if you enjoy bargaining over the value of your personal property collected over many years.

For most, though, using a professional is a better idea and an auction house might generate more money.

For local on-site “tag sales” (estate sales), consider “Caring Transitions” (410-951-4111). For auctions off-site, I’ve used Caplan’s Auction Co. in Savage (410-750-7678) and Associated Auctioneers in West Friendship (fairgrounds) (410-489-7200).

Good luck and think positively! No more snow shoveling to do.

Death Brings Myriad Emotions

When a loved one dies, particularly if it’s a spouse, the survivor is often overwhelmed by a variety of emotions. Here is a list of what might be encountered:

Shock: The survivor may be stunned by the turn of events, even after a lengthy illness.

Disorientation: Some may experience confusion and have trouble focusing.

Denial: The loss might seem like a bad dream. The survivor may withdraw from daily activities or experience a flurry of activity and return to work and hobbies shortly after the death.

Anxiety: Extreme worry about the future may lead to paralysis of thought or action.

Guilt: Wishing one had done things differently, or been there more, even if he or she was caring and concerned at the time of illness.

Depression: Lingering sadness or a melancholy that comes and goes even years later.

Vulnerability: Others may seem to be out to fool the surviving spouse—and that may have a measure of truth in it. It is wise to proceed into new areas of interest with caution.

Loneliness: Despair at returning to an empty house, especially at night. This emotion may prompt some to latch onto other people just because they are available.

These feelings usually pass with time. But, it might be several months or much longer depending on the individual. For most, there will come a time when the survivor is able to accept what has happened and resume “normal” activities, although certainly never forgetting. Despite what some well-meaning friends might say, life will never be the same.

The progression of grief is necessary to recognize because until these unavoidable emotions have dissipated, the survivor is not in a proper frame of mind to make long-term decisions whether it be about legal, financial matters or family.