Asset Protection Today with Bill Alexander

Bill goes through scenarios of when it makes sense to convert a retirement account to an IRA.

Important concepts to consider before you retire and how to set yourself best for asset protection in retirement.

Bill continues his conversation with Diane Surgeon as the subject shifts to what you need to do once your caregiving journey has concluded. 

Bill welcomes attorney Diane Surgeon to discuss how taking care of yourself when in a caregiving role is an essential part of life planning.

Bill breaks down what you need to know about taking money out of a retirement account, before and after retirement.

Bill describes how 401K retirement accounts work and how to avoid some common mistakes.

Bill dives in to the options and costs of the various forms of long-term care that are available. 

Bill explains what umbrella insurance is, how it should be used, how much you should have and why it's more important than you think. 

Bill explains how a potential new piece of legislation could create major changes for retirement accounts. 

Bill goes into detail on how trusts work and how revocable trusts can be used in your asset protection plan to protect your assets from uncertain family dynamics. 

When thinking of gifts to leave for grandchildren, Bill shares why he believe life insurance is the way to go over college funds. 

Bill explains why a medical release should included in your legal documents and the problems it could present for your family and loved ones if you don't have one. 

Bill shares a story of how family dynamics and unravel your planning, and how that can be avoided with trust-based planning.

Bill explains what a stretch IRA is and the two major benefits that it provides. 

Bill explains the importance of the legal document known as the digital release. Not having one can create a nightmare when it comes to finding and managing a loved one's online assets. 

Bill exposes pitfalls and unforeseen expenses that can bust your budget when you're on a fixed income in retirement. 

The will is one of the most misunderstood legal documents. In this episode Bill explains why it's a bad idea to write your own will without professional help, but also addresses what needs to be done if you choose do it anyway. 

In our final installment of our series on VA benefits, Bill walks us through the application process. 

In the second episode of our three-part series, Bill explains what the VA Improved Pension Program is, how to qualify, and what the spousal benefit is.

Bill goes in-depth on potential veterans benefits, explaining why navigating the waters of the VA is so difficult and why it is nearly impossible (by design) to do without professional help. 

While we normally focus on protecting the wealth and assets you have acquired, this episode focuses on acquiring money that you were not aware belongs to you. 

The second and final installment of our series exploring how asset protection and gifting changes with a special needs child or loved one. Bill explains what an ABLE account is and how best to use it.

The first half our two-part series exploring how asset protection and gifting changes with a special needs child or loved one.

Bill gives advice on how to protect yourself from scams involving tax returns and fraudsters posing as the IRS. 

Not having your business setup as the right asset protection entity is a risky proposition. In this episode, Bill explains how to make that choice, as well as the advantages and disadvantages of the different entity types. 

Bill explores the pitfalls of gifting real estate and answers the question if you should payoff your mortgage before retirement. 

Seniors often wish to make large gifts to loved ones prior to death. Unfortunately, seniors can lose control by gifting property in advance. With good advice, you can ensure that your property is protected for yourself and future generations while preserving full or partial control. Sometimes, seniors create capital gains taxes for their children by gifting them appreciated property during their lifetime. Parents often don’t realize that a gift of appreciated property results in their child taking the property’s original income tax basis. If the child sells the property, he or she will pay capital gains tax on the difference between the cost of the property when originally purchased by the parent and its current fair market value. In contrast, children who receive property from their parents at death inherit a “step up” in income tax basis, which is its fair market value at time of death. Children who sell inherited property soon after receiving it will pay no capital gains taxes. It’s important to note that federal gift tax rules differ from government assistance program eligibility rules. Both Medicaid (for nursing facility care) and Special Assistance (for assisted living facility care) implement sanctions for gifting. Historical Christmas and birthday gifts generally are not problematic. However, seniors must be particularly careful when gifting large amounts, as these can backfire and prevent eligibility. Medicaid looks back five years for gifts to anyone other than your spouse, and creates a penalty period based on the amount of money (or value) transferred. Special Assistance looks back three years. Therefore, even those gifts within the annual exclusion limit will result in sanctions if made during the “look-back” period. Finally, seniors can lose control of their property through gifting. Both the Medicaid and the Special Assistance programs allow seniors to avoid sanctions if they receive a “gift back” of transferred property. This requires the person to whom you gifted property to return either the exact gift or a gift of equal value in North Carolina. (The “gift-back” rules vary from state to state.) Unfortunately, seniors who require government assistance may not qualify if a child refuses to return or can’t return the property they received. Don’t expect a grandchild to return the tuition payment you made for them; however, the grandchild’s parent may be able to transfer back something of equal value in North Carolina. If you or your loved ones have questions about gifting, consider W.G. Alexander & Associates – we are experienced attorneys who offer a unique blend of asset protection, Elder Law and estate planning. You can also attend our free seminars, learn more through our website at www.wgalaw.com, or call us at (919) 256-7000.

Long-term care insurance is important for anyone who wants to have their needs satisfied at home or worst case in an assisted living facility, as no one dreams of spending their final years in a nursing home facility. Bill explains what you want to look for in a long-term care insurance policy, and equally important, what to avoid. 

The key to any effective asset protection plan is planning. As we progress through various life phases, our asset protection plan needs to evolve as well. In this episode, Bill details the life milestones that require you to review your estate planning. 

Everyone wants a plan that is going to work the way that they want. Unfortunately, there are many ways that a plan can fall apart. How you own and manage your rental property makes a huge difference to whether your overarching estate plan will work.   It’s important to remember that planning involves more than just having the right documents in place. Often, people are not really protected the way that they think they are, as they have not received proper advice about how to get their plan to work for them. Ultimately, your planning should be comprehensive, where everything fits together the way that you want. In this episode, Bill gives asset protection advice for rental property owners.  If you need assistance with your comprehensive plan, or if you have questions about government assistance programs such as Medicaid, Veterans Benefits, or other Special Needs programs, consider W.G. Alexander & Associates – we offer a unique blend of asset protection, Elder Law and estate planning. You can also attend our free seminars, learn more through our website at www.wgalaw.com, or call us at (919) 256-7000.

Sometimes our clients completely overlook one important financial issue when planning for  retirement.  Your health risks and the cost of a long-term care crisis, as well as the importance of maintaining financial liquidity are all factors that you must analyze when planning. The biggest things that most people fail to consider is that their future wealth and ability to maintain a reasonable lifestyle directly corresponds with their health. Many financial planners will tell you how much income you will need to keep you at your accustomed standard of living throughout retirement, but few will stress the likelihood or expense of a long-term care crisis.  Failing to factor in these risks is unwise, as long-term care can cost between $3,000-$7,000 a month.  This would be a devastating financial crisis for most. For this reason, consider both your health risks and your financial portfolio when planning for retirement. Planning for the worst will not solve all of your problems, but it will put you in the best possible position to confront the unexpected. Contact an experienced Elder Law Attorney today to help you with your retirement planning. At our firm, we encourage seniors to maintain financial liquidity as they age.  This is because paying for long-term care requires cash—and most seniors will eventually need help with activities of daily living or more.  There are many families who enjoy high net worth in land or businesses that lack liquidity. These families and others without cash often struggle when faced with a long-term care crisis, because they lack the cash flow necessary to pay for the cost of care.  For this same reason, annuities can be dangerous to seniors, as they limit the amount of money that a family has in times of crisis. While many annuities have great sounding terms, insurance companies retain ultimate control of your money. In addition, most annuities have hefty withdrawal penalties. The bottom line is that if you have plenty of liquidity or long term care insurance, you will be protected from a long-term care crisis. But, if you lack liquidity, you face a greater risk of being unable to pay for long term care in times of need. If you or your loved one needs assistance with retirement planning, or if you have questions about government assistance programs such as Medicaid or Veteran’s Benefits, consider W.G. Alexander & Associates – we offer a unique blend of asset protection, Elder Law and estate planning.  You can also attend our free seminars and learn more at www.wgalaw.com or call us at (919) 256-7000.

In this episode, Bill goes over the 199A tax deduction. It's a new tax deduction for business owners and Bill explains how it works and who it works for. 

Bill goes in-depth on why it is so important to have long-term care insurance and how not having a policy can put your assets and wealth at risk. 

Many people count on Social Security as their main source of retirement income. They also rely on Medicare as the health insurance they will carry for the rest of their life. The two go hand-in-hand and sadly, too many people fail to understand how potential annual increases to Medicare, can drastically affect how much money is actually left after the insurance premium is deducted from the monthly benefit.  In this episode, Bill explains why that is the case and what you can do to protect yourself. 

When you are thrust into a long term care crisis, it can be difficult to understand the differences between independent living, assisted living and nursing care. In this episode, Bill explains the difference between the different levels of care and how to protect yourself and your assets in each situation. 

In the second and final episode of our two-part series, Bill discusses in what ways he was prepared for his brother's death and in what ways he wasn't. Bill offers some critical tips for organizing your important documents. 

In the first episode of a two-part series, Bill discusses what it was like to lose his brother, who dealt with a long life of health struggles. He offers tips to help those who may be going through a similar experience, and provides insight on what to expect during the process of losing a loved one. 

Bill explains what the Programs of All-Inclusive Care for the Elderly (PACE) program is and how it can benefit seniors who have serious disabling conditions that would normally require nursing care. Who qualifies and what benefits does the program provide? Listen to the episode below for those answers. 

Bill has a loved one dealing with a healthcare crisis. In this episode, he explains the steps to take to ensure your assets are protected when in a healthcare crisis. 

At W.G. Alexander & Associates, we know that the power of attorney is the most important document that a client can have. In terms of doing estate planning, asset protection planning, and looking into Medicaid and VA benefits (Aid and Attendance) options available to a client, the power of attorney can either help or hinder a family from seeking help for their loved one A power of attorney is a written document in which one person (the principal) appoints another person to act as an agent (power of attorney) on his or her behalf, thus conferring authority on the agent to perform certain acts or functions on behalf of the principal. The powers conferred upon the agent are limited to what the document specifically authorizes. For example, a lot of people have something called a short form power of attorney. In this document, the principal either initials or decides not to initial certain powers thereby granting or not granting powers to her or his agent. In just the same way that a principal can decide not to confer powers to her or his agent by not initialing a power, if a document does not specifically state than an agent has a certain power the principal does not confer said power to the agent. Do you know what your power of attorney authorizes? Bill explains why that can be a major issue in this episode. 

In this episode, Bill explains that life insurance can be both a savings and asset protection tool. He goes over the difference between term life and whole life policies, gives his take on which of the two types of policies he prefers. 

Making investments and understanding risk can be overwhelming. This is why many people choose to rely on a financial adviser to help manage their investments. However, it's important to know that your financial adviser is only as good as the tools that he or she has at their disposal.  In this episode Bill explains why certain investments are recommended by financial advisers and goes into detail on bonds, exchange traded funds, mutual funds and other investment tools.  Want to learn more? Schedule a consultation with W.G. Alexander & Associates – we offer a unique blend of asset protection, Elder Law and estate planning. You can also attend our free seminars, learn more through our website at www.wgalaw.com, or call us at (919) 256-7000.

In our previous episode, we told you how all families should implement an overarching plan to protect their assets. But what should you do if you have no family?  You will still need the right kind of legal documents and you will need to make some choices when it comes to trusted individuals. For these reasons and many more, you need an experienced planning attorney who will advise you regarding all the various options and strategies for your unique situation. In this episode, Bill explains how family dynamics change for those who have no living family members. If you or your loved have questions about asset protection, or would like to know more about government assistance programs such as Medicaid, Veteran’s Benefits, or other Special Needs programs, consider W.G. Alexander & Associates – we are experienced attorneys who offer a unique blend of asset protection, Elder Law and estate planning. You can also attend our free seminars, learn more here, or call us at (919) 256-7000.

All families should implement an overarching plan to protect their assets. Unfortunately, most families fail to first consult an experienced attorney for good legal advice regarding how their estate plan and legal documents interconnects with their insurance and financial needs. As a result, most families end up with a hodge-podge of assets with various title holdings that sometimes conflict and often fail to work as anticipated. Basic asset protection requires the right kind of legal documents. Some attorneys act as scriveners who simply draft boilerplate legal documents in an attempt to fit every family into the same box. This type of estate planning is not helpful, as every person is unique and each family has different needs and dreams. Certain members of your family may manage their money well, while others may be spendthrifts. Some have a need for absolute control; others don’t. Some require agents to step forward because of frailty or cognitive impairment. Some need to insure the safety of others after they pass. Most can afford with time and money to establish and maintain a family plan; others can’t or procrastinate about it until it’s too late. For these reasons and many more, you need an experienced planning attorney who will advise you regarding all the various options and strategies for your unique situation. In this episode, Bill explains how family dynamics can make or break your asset protection plan and goes over the pitfalls that need to be avoided with family. If you or your loved have questions about asset protection, or would like to know more about government assistance programs such as Medicaid, Veteran’s Benefits, or other Special Needs programs, consider W.G. Alexander & Associates – we are experienced attorneys who offer a unique blend of asset protection, Elder Law and estate planning. You can also attend our free seminars, learn more here, or call us at (919) 256-7000.  

We conclude the story of a client who had an asset protection plan undone by incorrect legal documents. 

Legal documents, such as wills and powers of attorney, can help you control and protect your property. However, most fail to use their legal documents to their advantage. Many fail to realize that their legal documents don’t work the way that they expect or intend with their overarching estate plan. If done correctly along with proper planning, your legal documents can keep your family in harmony after your death. In this episode, Bill tells the story of a client who had an asset protection plan undone by incorrect legal documents.    People often think that a last will and testament trumps every other document. While a will is important, this is generally not the case. For example, many husbands and wives own their property jointly. When a husband and wife own a home in North Carolina, the survivor normally will own the house as stated on the deed. This is the case regardless of what their Wills say. Likewise, if you leave everything in your Will to your spouse but designate your children as beneficiaries of your life insurance policy, your children will receive the life insurance. This is true regardless of the language in your will. Finally, if you have a joint account at the bank with one of your children, that child is entitled to half or all of the account. This is the case even if your Will leaves your assets to all of your children equally, because your contract with the bank trumps the will. If you or your loved one needs assistance with your legal documents, or if you have questions about government assistance programs such as Medicaid or Veteran’s Benefits or other Special Needs programs, consider W.G. Alexander & Associates – we offer a unique blend of asset protection, Elder Law and estate planning. You can also attend our free seminars, learn more through our website at www.wgalaw.com, or call us at (919) 256-7000. 

Real estate can be an excellent investment under the right circumstances. When it comes to owning an investment property, what are your options when you're interested in moving on? In this episode, Bill explains the concept of the real estate exchange, a method of replacing one investment property with another, without having to foot a major tax bill.    There are risks involved with any type of real estate purchase. The most important thing is to get advice from professionals before purchasing any property. Knowledgeable real estate agents, financial advisors, and home inspection professionals are invaluable for their help and knowledge. Understand what factors are involved in your decisions and what your long-term goals are before you make any purchase. W.G. Alexander & Associates discusses the Veterans Pension in more depth, along with other assistance programs, during our free seminars every second Wednesday of the month at Independence Village of Raleigh at 2:00pm and 6:30pm. Register for our free seminars through our website at www.wgalaw.com, or call us at (919) 256-7000.

It seems that everyone wants to sell you an annuity for every situation. While annuities sound like safe investment options, they aren’t nearly as good as they sound. Annuities are often complicated legal contracts that consumers do not fully understand. People just don’t know what they’re purchasing. In essence, you are giving up control of your money for many years, in exchange for a guarantee that you will get all your money back with some interest. The good part is that you are not taxed on the gain until you start withdrawing your money. The bad part is that the gain is always taxed no matter who gets the money or when. The really bad part, especially for seniors, is that if you need to withdraw more than the contract allows, the guarantees go away and you must pay a steep penalty for the privilege of getting your money back. One would never invest in an annuity if you knew at the beginning that you would need most of your money back before the term of the contract allowed for it. Unfortunately, people rarely anticipate bad things happening to them when they purchase an annuity. You may experience health problems 5-10 years after you purchase your annuity; unfortunately, that’s when seniors need a lot of cash, and that’s when they learn about the consequences of an annuity. Generally, annuity salespeople receive hefty commissions. If your sales person received a high commission, then you may have a longer penalty period and a higher penalty for taking your money out early. In addition, taking your money out early results in the disappearance of all the guaranties promised in your annuity contract. While not all annuities are bad, most annuities are not good investments, particularly for seniors. Annuities frequently pay low interest rates and make little money compared to other investment options. In addition, other investment options may have more favorable tax implications than an annuity. There is no income tax inside of an annuity. Instead, much like an IRA or other qualified money, the gain is not taxed while it’s accumulating (known as a deferral), but it is taxed as ordinary income when you withdraw your money. At that time, you will pay income on the gain (and not the principal on the investment). This gain is taxed at higher ordinary income tax rates rather than lower capital gains tax rates. Therefore, if your spouse should die, you will not receive a tax break on this investment. You will pay ordinary income tax on the deferred gain, rather than receive a “step up in basis.” To illustrate, imagine purchasing Microsoft stock for $10 that you hold on to until your death. When you pass away, this stock is worth $1,000. Your spouse would receive a “step up in basis” at your death, and he or she would pay no capital gains taxes on this investment. This is a far better tax strategy than an annuity, where you will always have to pay income tax on the gain inside the annuity. Some annuities are very good for the right client, but typically seniors are presented with those that have hefty penalties if you need to get your money back within a certain period of years. For this reason, look at alternative investments and visit your financial advisor to determine the best investment strategy for your particular situation. If you have questions about annuities for seniors, Medicaid, or Veterans benefits, consider W.G. Alexander & Associates – we offer a unique blend of asset protection, Elder Law and estate planning. You can also attend our free seminars or call us at (919) 256-7000.

Families frequently come to our law office seeking help for a long-term care crisis.  Long-term care needs cause the loss of independence and the depletion of assets and they know we can help.  In one instance, a couple saved enough cash and retirement assets to support them for their lifetime.  However, one spouse’s chronic illness required daily assistance that ultimately led to nursing care.  Even though the nursing care was expensive, the spouse was confident their assets would hold out without impoverishing her.  Unfortunately, without an asset protection plan in place the couple’s assets quickly diminished.  The spouse didn’t seek help until she panicked over running out of money.  Her big mistake was waiting until their resources were low.  We got her husband on Medicaid within a few weeks, but if we had seen her two years earlier we could have preserved almost all of their assets while getting Medicaid, and she could have enjoyed plenty of money for the rest of her life.  While a bigger crisis was avoided, waiting to get good advice cost the family hundreds of thousands of dollars. Requiring long-term care means you need help performing activities of daily living (ADLs) such as bathing, dressing, toileting, eating, and/or taking medicine.  Most people are optimistic hoping they will never need assistance; over half are wrong and will suffer 3 years as nursing facility patients.  Long Term Care expense remains the biggest single financial risk for seniors.  Chronic illness and injury can require long-term care services immediately and at any age. Assistance with ADLs is growing dramatically; it is 120 times more likely to occur than a car accident and 20 times more expensive on average. A long term crisis for most families requires spending the equivalent cost of your home burning to the ground with no insurance coverage. Everyone wants to remain at home as long as possible. In fact, spouses provide the majority of assistance at home for loved ones in need of long-term care, and that has a double impact on the family.  The high demands for a caregiving spouse creates stress, fatigue, and depression with its own negative health effects.   Being chained to your loved one doubles the pain over time, but stress over running out of money or feeling impoverished causes fear and resentment. The cost of long-term care services rises every year and varies based on the level of care needed; ranging on average between $44,000 and $100,000 annually. There are programs available to help pay for long-term care. Assistance programs vary based on need, income, and assets. However, Medicare and your health insurance do not cover long-term care.  There are some government assistance programs, including the VA, Special Assistance, and Medicaid, that can help when you know how to navigate those programs.  Many individuals can qualify for Medicaid with assistance.  If your loved one requires nursing facility care, the good news is that most middle-class families can qualify for Medicaid quickly with the help of an experienced elderlaw attorney.  The key is seeking help quickly.  Planning in advance of D-Day provides more affordable options for long-term care; waiting until the crisis strikes to consult with your elderlaw attorney results in fewer options and greater costs but still allows solutions to preserve most of your remaining assets and resources. If you have questions about elderlaw, asset protection or retirement planning, consider W.G. Alexander & Associates – we are experienced attorneys who offer a unique blend of asset protection, Elder Law and estate planning. You can also attend our free seminars. Learn more through our website at www.wgalaw.com, or call us at (919) 256-7000.

Basic asset protection planning consists of four main components to make sure you are well protected. The first and most important component is a good liability insurance policy—and that normally means an umbrella policy to give you adequate coverage. You need to take care of this component first, which makes the other components work. Secure the policy before the fact and before it is too late. Also in this component is auto insurance. In this episode, Bill tells the story of one client who had a wonderful asset protection plan unraveled by a mistake with auto insurance. Bill also explains the importance of having "Med Pay" in your policy.  If you or your loved have questions about asset protection, or would like to know more about government assistance programs such as Medicaid, Veteran’s Benefits, or other Special Needs programs, consider W.G. Alexander & Associates – we are experienced attorneys who offer a unique blend of asset protection, Elder Law and estate planning. You can also attend our free seminars, learn more through our website at www.wgalaw.com, or call us at (919) 256-7000.

The DNR (Do Not Resuscitate) order, otherwise referred to as an AND (Allow Natural Death), only apply to situations where a patient is no longer lucid. Either the patient's heart has stopped or the patient is no longer to breathe on their own, and the patient has determined ahead of time that they do not want any further life-saving actions taken.  DNRs are critical medical documents, however, they are one of the most misunderstood documents related to end of life. In this episode of Asset Protection Today, Bill explains how the DNR can be abused.