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My mom (63 years old) set up a Roth IRA in the 1990s with me (26 yeas old) as the beneficiary, and thanks to my mom's diligent investment choices, it has done quite well. Earlier this year, my mom was diagnosed with a brain tumor out of nowhere. Soon after her diagnosis, she wanted to liquidate her Roth IRA and transfer it to me because she wanted me to pay off my student loans and have a down payment for a house. But I stopped her because I was worried that might be a bad decision.
My mom had a grim prognosis from the start (average 12-18 months even with treatment), and she has gotten progressively worse. She is now no longer cognitively able to make any important decisions. I've been her medical and financial durable POA for several months now, and I'm trying to figure out how we will pay for her eventual hospice and/or nursing home care. My father (her husband) lives on fixed Social Security income, and my mom has no income of her own (she hasn't reached retirement age and hasn't worked for almost 20 years). There is no way his fixed income can pay for the cost of hospice or nursing home care, so the hospice people mentioned applying for Medicaid because they think she could qualify as my mom has none of her own income.
Even if I wasn't the beneficiary, I don't see why my mom should have to spend all of her Roth IRA that she worked so hard to save and invest smartly because of the extremely, ridiculously low chance and bad luck of getting a brain tumor. It's not like she smoked all of her life or is obese and is now trying to get the state to pay for her poor choices. It's not her or our fault, and our family shouldn't have to suffer for it.
What can I do to protect as much of this money as possible before we apply for Medicaid or look into hospice?
You need to speak with an attorney. Roth IRA's may not be exempt, but there might be a way around that. State law usually governs from what I understand.
You do understand forcing tax payers to pick up the tab so you could have her money is not the moral thing to do.
If she was a lifetime smoker and got lung cancer, I would agree with you. My mother's illness was not caused by anything she or my family did. A societal safety net should exist for things like this, and because it doesn't, I don't have the slightest issue using any legal method to protect as much of my mother's life time of savings and hard work as possible.
Quote:
Originally Posted by Pitt Chick
Your mother set up the IRA for her future living expenses. That is what it should be used for.
It is a shame that you covet it for yourself.
Oh my god, you've got to be kidding me. People make investments with their children/heirs in mind all of the time. I don't "COVET" it. I'm not trying to withhold her care so I can have it. I will spend every last dime if it is necessary for her to have the proper end of life care, but if there is a way to protect it, why wouldn't I?
Don't try to moralize when there is no moral issue here. Asset protection is a very real investment consideration, and people do it all of the time. Multi-millionaires set up all kinds of trusts to protect their assets upon their deaths so their heirs don't have to pay estate taxes, but for some reason my trying to protect a paltry $60,000 that my mom wanted me to have (note that she made me her beneficiary on her own accord when I was still a minor) in the first place is somehow morally and ethically repugnant?
If you don't have advice, kindly don't say anything at all.
If she was a lifetime smoker and got lung cancer, I would agree with you. My mother's illness was not caused by anything she or my family did. A societal safety net should exist for things like this, and because it doesn't, I don't have the slightest issue using any legal method to protect as much of my mother's life time of savings and hard work as possible.
So, under this theory, if get a flat tire the taxpayers should pay for my new tire since it wasn't my fault there was a nail on the road. Some people get everything free, from craddle to grave, but the rest of us have to pay our share, unless she has Obama Care.
Oh my god, you've got to be kidding me. People make investments with their children/heirs in mind all of the time. I don't "COVET" it. I'm not trying to withhold her care so I can have it. I will spend every last dime if it is necessary for her to have the proper end of life care, but if there is a way to protect it, why wouldn't I?
[COLOR="rgb(72, 61, 139)"]On a prior post you said she has already given you thousands so didn't she alread make in investment in your happiness?[/color]
Don't try to moralize when there is no moral issue here. Asset protection is a very real investment consideration, and people do it all of the time. Multi-millionaires set up all kinds of trusts to protect their assets upon their deaths so their heirs don't have to pay estate taxes, but for some reason my trying to protect a paltry $60,000 that my mom wanted me to have (note that she made me her beneficiary on her own accord when I was still a minor) in the first place is somehow morally and ethically repugnant?
If you don't have advice, kindly don't say anything at all.
Actually, in the overall scheme of things, the amount of money you are talking about really isn't that much. I do hope you find peace and someday understand that we must make our way in the world; no one will give you anything. She apparently didn't work long enough accumulate a large sum so what she has will likely pay for a small portion of her medical care. As an alternative, you could pay her medical bills and then be free to collect her savings.
My mom (63 years old) set up a Roth IRA in the 1990s with me (26 yeas old) as the beneficiary, and thanks to my mom's diligent investment choices, it has done quite well. Earlier this year, my mom was diagnosed with a brain tumor out of nowhere. Soon after her diagnosis, she wanted to liquidate her Roth IRA and transfer it to me because she wanted me to pay off my student loans and have a down payment for a house. But I stopped her because I was worried that might be a bad decision.
My mom had a grim prognosis from the start (average 12-18 months even with treatment), and she has gotten progressively worse. She is now no longer cognitively able to make any important decisions. I've been her medical and financial durable POA for several months now, and I'm trying to figure out how we will pay for her eventual hospice and/or nursing home care. My father (her husband) lives on fixed Social Security income, and my mom has no income of her own (she hasn't reached retirement age and hasn't worked for almost 20 years). There is no way his fixed income can pay for the cost of hospice or nursing home care, so the hospice people mentioned applying for Medicaid because they think she could qualify as my mom has none of her own income.
Even if I wasn't the beneficiary, I don't see why my mom should have to spend all of her Roth IRA that she worked so hard to save and invest smartly because of the extremely, ridiculously low chance and bad luck of getting a brain tumor. It's not like she smoked all of her life or is obese and is now trying to get the state to pay for her poor choices. It's not her or our fault, and our family shouldn't have to suffer for it.
What can I do to protect as much of this money as possible before we apply for Medicaid or look into hospice?
I am only curious about one thing, how could your Mother who you stated hasn't worked outside of the home for almost 20 years be the one who worked so hard and so long to save have the money to save unless it came from your Father?
If you want financial advice regarding this contact a financial planner who is also an attorney or in the same company as a financial attorney.
They will be the ones to give you all the legal information you need and help you determine if you will fact be able to keep any of the money in the IRA or if it has to be liquidated before she qualifies for whatever welfare benefits she may be able to receive.
If she was a lifetime smoker and got lung cancer, I would agree with you. My mother's illness was not caused by anything she or my family did. A societal safety net should exist for things like this, and because it doesn't, I don't have the slightest issue using any legal method to protect as much of my mother's life time of savings and hard work as possible.
Umm, Medicaid is the safety net. It's for people that have no assets. Normally what people do is buy LTC insurance, but if you have no assets LTC insurance seldom makes sense because Medicaid will cover you.
Quote:
Originally Posted by Cigur11
Don't try to moralize when there is no moral issue here. Asset protection is a very real investment consideration, and people do it all of the time. Multi-millionaires set up all kinds of trusts to protect their assets upon their deaths so their heirs don't have to pay estate taxes, but for some reason my trying to protect a paltry $60,000 that my mom wanted me to have (note that she made me her beneficiary on her own accord when I was still a minor) in the first place is somehow morally and ethically repugnant?
If you don't have advice, kindly don't say anything at all.
That's not really the same thing. What you are trying to do is shield money from being considered an asset and have the taxpayer pick up the tab. A lawyer can tell you how to go about arranging things, but you may have to spend some of the money on your mom. It just depends on how a Roth IRA is treated in your state.
My mom (63 years old) set up a Roth IRA in the 1990s with me (26 yeas old) as the beneficiary, and thanks to my mom's diligent investment choices, it has done quite well. Earlier this year, my mom was diagnosed with a brain tumor out of nowhere. Soon after her diagnosis, she wanted to liquidate her Roth IRA and transfer it to me because she wanted me to pay off my student loans and have a down payment for a house. But I stopped her because I was worried that might be a bad decision.
My mom had a grim prognosis from the start (average 12-18 months even with treatment), and she has gotten progressively worse. She is now no longer cognitively able to make any important decisions. I've been her medical and financial durable POA for several months now, and I'm trying to figure out how we will pay for her eventual hospice and/or nursing home care. My father (her husband) lives on fixed Social Security income, and my mom has no income of her own (she hasn't reached retirement age and hasn't worked for almost 20 years). There is no way his fixed income can pay for the cost of hospice or nursing home care, so the hospice people mentioned applying for Medicaid because they think she could qualify as my mom has none of her own income.
Even if I wasn't the beneficiary, I don't see why my mom should have to spend all of her Roth IRA that she worked so hard to save and invest smartly because of the extremely, ridiculously low chance and bad luck of getting a brain tumor. It's not like she smoked all of her life or is obese and is now trying to get the state to pay for her poor choices. It's not her or our fault, and our family shouldn't have to suffer for it.
What can I do to protect as much of this money as possible before we apply for Medicaid or look into hospice?
So...one thing to think about...medicaid will allow your mom to own a vehicle. They don't care what kind of vehicle it is. I'm not sure of the amount in this asset, but you could buy a new whatever and put it in your garage to liquidate later. Medicaid doesn't care that she can't drive...and clearly, by their rules, she can own a car and still be eligible for medicaid.
PLUS...your mom should be collecting HER share of you DAD's Social Security.
My mom (63 years old) set up a Roth IRA in the 1990s with me (26 yeas old) as the beneficiary, and thanks to my mom's diligent investment choices, it has done quite well. Earlier this year, my mom was diagnosed with a brain tumor out of nowhere. Soon after her diagnosis, she wanted to liquidate her Roth IRA and transfer it to me because she wanted me to pay off my student loans and have a down payment for a house. But I stopped her because I was worried that might be a bad decision.
My mom had a grim prognosis from the start (average 12-18 months even with treatment), and she has gotten progressively worse. She is now no longer cognitively able to make any important decisions. I've been her medical and financial durable POA for several months now, and I'm trying to figure out how we will pay for her eventual hospice and/or nursing home care. My father (her husband) lives on fixed Social Security income, and my mom has no income of her own (she hasn't reached retirement age and hasn't worked for almost 20 years). There is no way his fixed income can pay for the cost of hospice or nursing home care, so the hospice people mentioned applying for Medicaid because they think she could qualify as my mom has none of her own income.
Even if I wasn't the beneficiary, I don't see why my mom should have to spend all of her Roth IRA that she worked so hard to save and invest smartly because of the extremely, ridiculously low chance and bad luck of getting a brain tumor. It's not like she smoked all of her life or is obese and is now trying to get the state to pay for her poor choices. It's not her or our fault, and our family shouldn't have to suffer for it.
What can I do to protect as much of this money as possible before we apply for Medicaid or look into hospice?
My condolences to you. I am sorry that you and your family are going through this.
Your mother is old enough to collect Social Security benefits either based on her husband's earnings or her own, whichever produces the highest income for her. You should make an appointment to discuss this with someone in your local Social Security office as soon as possible. Her application can even be back dated a few months, I believe. You can also find out whether she qualifies for any other benefits based on her disability. I am assuming she is on Medicare. Medicare has a limited skilled nursing home benefit if she is hospitalized before she goes into the nursing home, if that becomes necessary. This means that you and her primary care doctor need to have a plan in place before her situation deteriorates. It is actually difficult to get into a nursing home in many communities without being in a hospital first.
She can also take distributions from her IRA. Her total income will determine whether that distribution will generate a tax liability or not.
There are very specific rules, which vary from state to state, about managing assets in order to be eligible for Medicaid. In most states, transferring assets soon before applying for Medicaid will disqualify the applicant, so it is good you did not do that. You need to speak with an attorney who specializes in elder law and practices in your state.
As others have pointed out, we as a community expect your mother's assets to be spent for her care first. Although we all regret the circumstances of your mother's illness and understand your anger at what is happening to her (which means you have already started the grieving process), it is wrong to expect us to pay for her care while she still has funds of her own, including the IRA. I have been in this exact position, and my mother's IRA was exhausted to pay the nursing home. She was actually on Medicaid for only a few months before she died.
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