New York residents who are creating or reviewing their estate plan might also want to think about long-term care planning. People may have planned carefully for retirement, but there might still be unexpected costs associated with long-term care. It is estimated that more than two-thirds of people who are now 65 will require long-term care at some point in their lives.
Long-term care is usually for people who have a chronic illness or a disability. This could be Alzheimer’s or a mental illness, or a person may be unable to perform basic tasks such as bathing, eating or dressing. Health insurance and Medicare may not cover the costs of long-term care, which are on the rise. One study by the Bipartisan Policy Center found that a 65-year-old’s long-term care costs will be about $138,000 over a lifetime.
One way to prepare for this cost may be to purchase long-term care insurance. This also protects a person’s other assets from being used to pay for the costs.
People may also want to consider what type of medical care they want if they become incapacitated and who they want to make medical decisions on their behalf. A health care proxy can be used to appoint someone to this position while a living will expresses a person’s wishes for end-of-life care. A power of attorney can appoint someone to make financial decisions on a person’s behalf if the principal becomes incapacitated. These documents that make preparations for illness can work in tandem with an estate plan that chooses who will receive certain assets. With respect to all aspects of the estate plan, from long-term care planning to asset distribution, people may want to discuss their desires with family members to make sure they understand why certain decisions have been made. They might want to have their attorney present at these meetings to answer questions that might arise.