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How is the VA Handling Aging Veterans?

The Department of Veterans Affairs and veterans organizations across the country are working to care for a new generation of older veterans who are apt to have greater expectations for longevity and independence than earlier generations, yet also may struggle with more complex medical conditions, reports Military Times’ recent article entitled, “America faces a tidal wave of aging military veterans.”

“We’re kind of compounding multiple variables, in the sense that not only are people living longer, but … many of them survived something that wasn’t survivable,” says Scotte Hartronft, the director of geriatrics and extended care at VA. “A lot of veterans have survived significant injuries over the last couple of conflicts that [they] wouldn’t have survived in previous wars.”

In California, the most populous state and home to the highest number of vets, the State Department of Veterans Affairs, known as CalVet, the state’s veterans department, is working to create a modern facility that centers the needs and dignity of older veterans. Like VA facilities across the country, people charged with caring for veterans must address the same question: How do we best care for those who have served on our behalf as they grow old?

Other states also have issues: between 2021 and 2041, the number of veterans older than 85 is expected to increase by 31%. That’s partially because the overall number of veterans nationwide is actually decreasing. Between 2000 and 2018, the number of veterans in the country declined by a third — the bulk of Americans who have served in the military served decades ago.

Vietnam and Gulf War-era veterans represent a different slice of the population than veterans who fought in World War II and Korea: the number of women veterans over 65 is expected to increase by 237% between 2021 and 2041. Racial diversity is also increasing, and the geographic distribution of veterans is shifting. As a result, veterans’ care must change. Women, for example, have a greater life expectancy than men do. Women veterans will generally need more support to continue to live independently as they age for longer — a fact compounded by the fact that women, who tend to be informal caregivers to friends and family, often have more difficulty than men finding their caregivers when needed.

In addition to higher rates of post-traumatic stress and other conditions affecting mental health, veterans are more likely to be exposed to risk factors, such as traumatic brain injuries or toxic exposure, for Alzheimer’s and other dementias. Vets also have a higher chance of being diagnosed with certain types of cancer, like lung and skin cancer. Roughly 50,000 new cancer cases among veterans are reported annually; that number is expected to rise as veterans age.

Every VA medical center will offer veteran-directed care within the next two years. This popular program provides qualified veterans with a stipend to hire local caregivers to assist them with daily living or even companionship. VA is expanding home-based primary care — which provides health care to veterans at home, many of whom are housebound — to 75 new sites and expanding its Medical Foster Care program. This lets some vets live in a private home with a caregiver rather than in a nursing home. They’re also piloting a program using predictive analytics to help determine which veterans are at the highest risk of nursing home care in the coming years to connect them with preventive services.

Reference: Military Times (June 2, 2023) “America faces a tidal wave of aging military veterans”

What’s the Best Way to Find the Right Assisted Living Facility?

News 19 Alabama’s recent article entitled “How To Choose the Right Assisted Living Facility,” provides some valuable tips for researching assisted living facilities and finding the best option for you:

Get recommendations. Ask friends, family and your doctor about assisted living facilities in the area and if they would recommend them. If someone you know lives in an assisted living facility, ask them how they like it, as their experience can provide insight into what facilities have the best reputation in your local area.

Consider your needs. Residents in assisted living facilities typically need assistance with some basic activities of daily living. This includes bathing, dressing, eating, and getting around. Some assisted living communities specialize in caring for people with specific conditions, such as Alzheimer’s. The level of care assisted living facilities offer can vary greatly, so consider how much assistance you require.

Consider the cost. Remember that Medicare doesn’t cover assisted living costs, which is why most people pay with private funds even though it’s expensive.

Consider location. A facility near friends and families is often the best choice. This lets residents receive lots of visitors. Employees will also see that the resident’s visitors scrutinize their care.

Ask questions. Before calling assisted living facilities, consider these questions:

  • How many residents live at the facility?
  • Are pets allowed?
  • What amenities are available to residents?
  • Are there personalized care plans for each resident?
  • How are additional services billed?
  • Are there doctors, nurses, pharmacists, physical therapists, housekeepers, cooks, and activity directors on staff?
  • Does the facility run background checks on staff?
  • What happens if a resident’s health deteriorates and needs additional care or a hospital stay?
  • What safety features does each residential unit feature?
  • What is the staff-to-resident ratio during the day and at night?
  • What are the meals the facility serves?
  • Are all utilities included in the overall cost of a unit?

Take note when you visit. When you tour a facility, look at the cleanliness, activities, safety features, available common areas, the friendliness of the staff and how healthy and happy the residents appear.

Compare several facilities before you decide. Don’t just choose the first facility you visit. Instead, tour several facilities and compare them.

Carefully examine contracts. Read assisted living contracts from start to finish and look for unexpected fees or deposits.  Yous should also pay attention to the rules regarding discharging or evicting a resident, late or missed payments and how the facility handles (or limits) your rights to file a lawsuit should there be an issue.

Reference: News 19 (May 14, 2023) “How To Choose the Right Assisted Living Facility”

What is the Purpose of a Blind Trust?

One type of trust offers a layer of separation between the person who created the trust and how the investments held in the trust are managed. The trust’s beneficiaries are also unable to access information regarding the investments, says the article “What is a Blind Trust?” from U.S. News & World Report.

The roles involved in a blind trust are the settlor—the person who creates the trust, the trustee—the person who manages the trust—and beneficiaries—those who receive the assets in a trust.

Blind trusts, typically created to avoid conflicts of interest, are where the settlor gives an independent trustee complete discretion over the assets in the trust to manage, invest and maintain them as the trustee determines.

This is quite different from most trusts, where the owner of the trust knows about investments and how they are managed. Beneficiaries often have insight into the holdings and the knowledge that they will eventually inherit the assets. In a blind trust, neither the beneficiaries nor the trust’s creator knows how funds are being used or what assets are held.

Blind trusts can be revocable or irrevocable. If the trust is revocable (also known as a living trust), the settlor can dissolve the trust at any time.

If the trust is irrevocable, it remains intact until the beneficiaries inherit the entire assets, although there are some exceptions.

In some instances, irrevocable trusts are used to move assets out of an estate. Settlors lose control over the holdings and may not terminate the trust or change the terms.

Blind trusts can be used in estate planning if the settlor wants to limit the beneficiaries’ knowledge of the trust assets and their ability to interfere with the management of the trust.’

People who win massive lump sums in a lottery might use a blind trust because some states allow lottery winners to preserve their anonymity using this type of trust. They draft and sign a trust deed and appoint a trustee, then fund the trust by donating the winning ticket to the trust prior to claiming the prize. By remaining anonymous, winners have some protection from unscrupulous people who prey on lottery winners.

One drawback to a blind trust is the lack of knowledge about how investments are being handled. The blind trust also poses the issue of less accountability by the trustee, since beneficiaries have no right to inspect whether or not assets are being managed properly.

Do you need a blind trust? Speak with an experienced estate planning attorney to discuss whether or not your estate would benefit from a blind trust. If you want to separate yourself from investment decisions or would rather beneficiaries don’t know about the holdings, it might make sense. However, if you have no concerns about privacy or conflict of interests, other types of trusts may make more sense.

Reference: U.S. News & World Report (June 1, 2023) “What is a Blind Trust?”

How Do I Start Saving for Retirement, if I’ve Been Lazy?

Many people think that time is running out for them to save.

Most Americans (66%) worry that if they don’t increase their retirement savings soon, it will be too late for them to have a comfortable retirement.

This is up from 61% last year, reports Forbes’ recent article, “It’s Not Too Late to Save for Retirement: Five Ways to Step It Up.”

  1. Take advantage of all benefits through your employer. Your employer likely has benefits to help you save for retirement. Many employers offer to match employee contributions to their 401(k) plans. An easy way to increase your savings is to make sure you contribute enough to get the full match.

Failing to contribute enough to get the full match is like throwing away free money. Some employers also offer programs to help employees receive matching funds without reaching the contribution threshold. For example, starting in 2024, a provision in the SECURE 2.0 Act will let employers match contributions to retirement savings for the amount employees pay back in student loans.

  1. Increase savings by 1%. The best way to have more in savings is to save more. A good strategy is to increase your contributions to retirement savings accounts by 1% every year.
  2. Convert savings into a Roth IRA. One way to control taxes on your savings is to convert it into a Roth IRA. Many retirement savings are made in tax-deferred accounts like a 401(k) or IRA. Taxes will be due when you begin withdrawing from those accounts to fund your retirement, so converting those funds into a Roth account and paying taxes now can help lower your taxes and increase your retirement nest egg.
  3. Consider where you’ll retire. Your take-home retirement income will vary based on where you live. If you worry about stretching your savings, living in a low-tax state could help. Eight states have no income taxes (Alaska, Florida, Nevada, South Dakota, Tennessee, Texas, Washington, and Wyoming). They don’t tax wages, salaries, dividends, interest, or any income, including Social Security benefits.
  4. Make catch-up contributions. If you are 50+, the IRS lets you contribute additional money to 401(k) and IRAs above the standard limit. This can help increase your savings in tax-advantaged accounts.

Reference: Forbes (June 5, 2023) “It’s Not Too Late to Save for Retirement: Five Ways to Step It Up”

What Should I Know About Advocating for a Loved One with Parkinson’s Disease?

Unfortunately, recent studies have shown that three out of every four hospitalized Parkinson’s Disease patients didn’t get their regular home medications on time or had doses entirely skipped.

Proper medication management is the most critical part of a successful hospitalization for someone with Parkinson’s Disease.

Antiparkinsonian medications (levodopa or amantadine, for example) must be given correctly, at the right time and in the correct dose.

If regular home medications aren’t provided in the hospital, Parkinson’s Disease patients can develop mental disturbances, increased muscle rigidity, tremors and difficulty communicating. As a caretaker, you have a vital role in helping the transition from home to the hospital run smoothly.

Next Avenue’s recent article, “How to Advocate for Your Hospitalized Loved One with Parkinson’s Disease,” has some ways you can do this.

Make sure you have an up-to-date list of medications your loved one takes. The list should include the name, dose, when it was last taken and what pharmacy is used for prescriptions. Be prepared to give this to the hospital staff when requested.

You should also list drug or food allergies, including reactions. For example, did a particular drug cause severe irritability or a rash in the past?

It is important to remain with your loved one when they arrive at the hospital until the first dose of their regular medication is administered. Note that a first dose can usually be delayed by several hours if the nurse needs to input the medication list into the chart immediately or if the hospital pharmacy is delayed in verifying the orders. However, after the first dose, future quantities will likely be on schedule.

Cooperate with nursing staff to make sure that your loved one is comfortable. Be direct, yet kind, in asking when the patient might need personal hygiene supplies, a quieter environment, or on-time medication.

As a caretaker, your education and experience regarding Parkinson’s Disease are powerful tools.

Some things might fall through the cracks in a busy hospital– and you know the patient best. So don’t be afraid to speak up and express your needs as you advocate for your loved one.

Reference: Next Avenue (December 22, 2023) “How to Advocate for Your Hospitalized Loved One with Parkinson’s Disease”

How Do I Transfer Vehicle Ownership of a Deceased Relative?

The way to transfer a vehicle after death can depend on several factors. These include whether the automobile was owned by one person or several individuals and whether any provision was made in a will for its transfer.

If the title to the vehicle has more than one name on it, then the surviving owner may inherit the vehicle by operation of law.

That person can change the title to put in their name only, without further intervention from the executor.

When the vehicle is titled in joint tenancy, and the owners are living, the signatures of all owners are necessary to transfer ownership. Joint tenancy is when the names of two or more owners listed on the title are joined with the word “OR,” “AND” or “AND/OR.” These words note the right of survivorship.

Yahoo Finance’s recent article, “What Happens If the Executor of My Will Dies?” explains that when the title is in the name of the deceased owner only, the title will have to be changed to whoever will assume ownership.

Suppose the motor vehicle is included in probate because there is no surviving joint owner or it hasn’t been transferred to a trust. In that case, a title change likely won’t be able to be completed until probate ends and ownership of the car is assigned to one of the decedent’s heirs.

There are three documents that you will typically need to transfer a vehicle title after death:

  • A copy of the owner’s death certificate
  • The original title; and
  • Probate court documents allowing the transfer.

Transferring vehicle ownership after someone passes away can vary from state to state. It’s a good idea to review the probate laws and contact the local Department of Motor Vehicles (DMV) to see what’s required to complete the transfer.

Reference: Yahoo Finance (May 15, 2023) “What Happens If the Executor of My Will Dies?”

Ever Wonder How the Very, Very Rich Pass Wealth to Their Children?

When making plans to pass assets on to family members, it’s important to consider how estate planning can help manage the taxes associated with inheritances, says a recent article, “Here’s How the Ultra Rich Pass Wealth Tax Free to Their Heirs” from yahoo! finance. The very rich have used many strategies to pass on wealth with limited or no taxes owed, and some of these strategies can be used by regular people too.

The annual gift tax exclusion. Transferring wealth during your lifetime, rather than after your death, allows you to gift any number of people up to $17,000 each in a single year without incurring a taxable gift and having no impact on your estate and gift tax exemption. Married couples may give up to $34,000. People often use this annual exclusion for cash gifts and deposits into 529 education savings plans. These plans permit “frontloading” of up to five years’ worth of gifts into one year, which results in longer and more significant compounded growth.

Paying directly for medical care or tuition. If you wish to help a loved one pay for healthcare needs or education costs, the way to do this is to pay the institution directly. You may make unlimited payments to medical providers or educational institutions on behalf of others for qualified expenses without incurring a taxable gift or impacting your $17,000 individual gift exclusion. In addition, qualified medical expenses would be considered deductible for income tax purposes. Educational expenses are tuition, not living expenses or dorm fees. However, educational expenses aren’t limited to college and could be for a private school at the primary or high school level. Even certain daycare and afterschool activities might qualify.

Using the lifetime gift and estate tax exemption. One of the best estate planning tax strategies is to gift assets you expect to have significant appreciation in the future. For example, you have a $100,000 investment in a tech start-up you believe will appreciate ten times over the next five years. Of course, gifting the $100,000 investment today makes you eat slightly into your gift and estate tax exemption. All the future appreciation of the investment is still out of your taxable estate and into the hands of your heirs—estate and gift-tax free.

Converting IRAs to Roth IRAs. The SECURE Act’s 10-year rule eliminated the ability to ‘stretch’ inherited IRAs over most beneficiary’s lifetimes. A way to preclude the tax burden on your heirs from an inherited IRA is to convert it to a Roth IRA. You’ll pay the taxes at the time of conversion, but they won’t have to pay taxes upon inheriting the IRA or any future appreciation in the account.

Implementing discount strategies. This is a complex strategy used for transferring family businesses or real estate. Discount strategies reduce the value of an interest before its transfer to its value for gift tax purposes is reduced. You maintain some control or benefit from the asset after the transfer. Examples are FLPs (Family Limited Partnerships), Limited Liability Companies (LLPs) and Qualified Personal Residence Trusts (QPRTs).

Reference: yahoo! Finance (May 25, 2023) “Here’s How the Ultra Rich Pass Wealth Tax Free to Their Heirs”

Estate Planning Lessons from Elvis’ Mistakes

So far, part of the Presley legacy appears to be the failure to create effective estate plans, says a recent article from Kiplinger, “Five Estate Planning Lessons We Can Learn From Elvis’ Mistakes.” An effective estate plan transfers assets and legacy to the right people at the right time, while keeping the wrong people out.

In this case, the right people would be the people whom Elvis and Lisa Marie wanted to benefit, and a good estate plan would have ensured that their desired beneficiaries or heirs received their inheritance. The right time would be to give control of assets to loved ones when they are mature enough to benefit for a lifetime. Keeping the wrong people out would mean minimizing tax and administrative costs and protecting heirs from lawsuits, divorce, creditors and a second level of estate taxes upon their own death.

Most recently, Priscilla Presley challenged a 2016 amendment to Lisa Marie’s trust which would have removed Pricilla as co-trustee from serving alongside Lisa Marie’s former business manager, Barry Siegel. This may have been her intent. However, the amendment didn’t include basic legal formalities. A confidential settlement was recently reached on this issue.

Priscilla had grown Elvis’ estate after his death. Despite his fame, he left an illiquid estate worth $5 million in 1977—adjusted for inflation, roughly $20 million in today’s dollars. The IRS successfully asserted that the estate was worth far more and asserted $10 million in estate taxes.

The estate didn’t include as much royalty income as expected because Elvis’ business manager, Colonel Tom Parker, sold the music catalog to RCA for $5.4 million, of which only $1.35 million went to the estate. Priscilla then assumed control of the estate. From her wise use of Graceland profits, merchandising and royalties for music recorded after the RCA deal, Priscilla grew the estate to $100 million.

In 1993, Lisa Marie turned 25 and was eligible to receive and control her inheritance. She established a revocable trust to hold her inheritance, then appointed a businessman as her co-trustee with primary control over her assets. In two years, he sold 85% of her interests in Elvis Presley Enterprises, an entity The Elvis Presley Trust created to conduct business, including Graceland and worldwide licensing of Elvis Presley Products.

The deal was worth $100 million but brought the estate only $40 million after taxes, plus $25 million in stock in a future holding company of American Idol, later made worthless due to bankruptcy by its parent company.

Careful planning could have avoided substantial income tax on the sale and provided the family a much better financial return. Siegal was removed as trustee in 2015 when lawsuits between Siegel and Lisa Marie began, which were pending when she died unexpectedly in 2023.

The lessons from the Elvis estate:

Use a trust, not a will. The trust removes delays, and higher costs and keeps private details private.

Make sure that your estate plan addresses estate tax issues. The goal is to reduce the value of the taxable estate and increase the value of your legacy to family and loved ones. The estate tax must be paid in cash within nine months from the date of death. This often requires a sale of estate or trust assets to pay the tax and can lead to heirs getting less than the full value of assets because of the need to come up with the cash. A simple testamentary charitable lead annuity trust (TCLAT) could have prevented the estate tax assessed after Elvis’ death and provided substantial benefits to Lisa Marie.

Plan for a lifetime legacy. Lisa Marie gained complete control over her inheritance at age 25. First, however, she needed to prepare for the complexity of the business and other assets she inherited and learn how to maintain a lifetime of living within her means.

Plan for estate taxes on the sale of the family business. Careful planning can almost always reduce the tax triggered by the sale of appreciated property. Unfortunately, no tax mitigation planning was taken before the $100 million sale of Elvis Presley Enterprises. As a result, the maximum capital gains tax, federal and estate combined, can be more than 40%.

Carefully choose the successor trustee or executor and provide at least two alternatives. Elvis appointed his father Vernon as the executor. Elvis died tragically in 1977 when Vernon was elderly and not well. Appointing a business manager as a trustee creates an inherent conflict of interest due to the business manager’s ability to profit from decisions made. A professional trustee would have been a better choice due to the complexity of the estate and Lisa Marie’s age.

Reference: Kiplinger (May 18, 2023) “Five Estate Planning Lessons We Can Learn From Elvis’ Mistakes”

How Can I Quickly Downsize?

Optimally, it’s best to spend months or years carefully purging excess belongings. However, life may get in the way, says The Independent’s recent article, “3 Steps to Downsize in a Hurry.” So let’s look at what we can do now:

  1. Collect paperwork. This includes photos, prescriptions, and perishables. You may want to box unsorted documents and photos for temporary storage in a climate-controlled area and sort through them later. Next, deal with the stuff that can’t be sold or donated, such as unneeded medications and perishable food that won’t be eaten in time. Nonperishable, unopened food items typically can be donated to a local food bank.
  2. Identify the ‘keepers’. These are possessions with a definite home. iIf someone’s moving, this includes things that will be going with them. However, if you’re clearing out after a death, keepers may consist of items destined for heirs. An executor officially charged with settling someone’s estate may be required to hire appraisers to value possessions before anything is distributed. If you have potentially valuable items, like antiques, jewelry, art, or collections, ask a personal property appraiser to help you determine what may be worth the extra effort of selling. However, hiring an appraiser can cost hundreds or thousands of dollars, which may not always be practical.
  3. Decide what to do with the rest of it. If you have several rooms of furniture and household items remaining, think about an estate sale to help you dramatically downsize. Estate sales are often organized by professionals who advertise the sale, price the items, handle transactions and provide security. Estate sales agents may agree to donate or dispose of whatever doesn’t sell. They typically get 30% or more of the sale proceeds. Giving stuff away is another option. However, charities are often selective about what they’ll accept. Check their websites or call first to avoid an unnecessary trip. Some charities will send a truck to pick up approved donations.

Reference: The Independent (May 18, 2023) “3 Steps to Downsize in a Hurry”

How is Congress Trying to Protect Seniors from AI Scams?

Senator Mike Braun, R-Ind., the ranking Republican on the Senate Special Committee on Aging, led a bipartisan effort to draft a letter to the Federal Trade Commission (FTC) that asks for an update on what the agency knows about AI-driven scams against the elderly and what it is doing to protect people. The letter, signed by every member of the Senate committee from both parties, asks about AI-powered technology that can be used to replicate people’s voices.

Fox News’ recent article entitled, “AI ‘voice clone’ scams increasingly hitting elderly Americans, senators warn,” reports that the letter to FTC Chairwoman Lina Khan cautioned that voice clones and chatbots are allowing scammers to trick the elderly into making them believe they are talking to a relative or close friend, which leaves them vulnerable to theft.

“In one case, a scammer used this approach to convince an older couple that the scammer was their grandson in desperate need of money to make bail, and the couple almost lost $9,400 before a bank official alerted them to the potential fraud,” the Senate letter said. “Similarly, in Arizona, a scammer posing as a kidnapper used voice-cloning technology to duplicate the sounds of a mother’s crying daughter and demand ransom.”

Senator Braun said “imposter” scams lead to about $2.6 billion in losses every year and that the elderly are especially at risk now that scammers have access to voice-clone technology.

“We’re getting calls into our constituent services line back in Indiana already where this is coming in and happening to some extent,” Braun said. He added that imposter scams can be done without using an artificial voice but warned that “AI makes it even easier because it’s like talking to your grandkid.”

Braun recalled a Senate hearing this week in which Senator Richard Blumenthal, D-Conn., opened the hearing on AI with an AI-generated voice that sounded like him, reading off an AI-generated script and said scammers have access to these same tools.

“When you can replicate a voice to the extent I couldn’t tell if that was Sen. Blumenthal or a replication – it sounded exactly like him – just imagine,” Braun said. “That is a tool that the scammers never had.”

The FTC has said it will use its authority to protect consumers from AI to the extent it can, as Washington policymakers look to expand their regulatory oversight of this new technology. The Senate letter to the agency suggested that the FTC update its “educational and awareness” materials to help seniors understand that scammers may be looking to fleece them out of their money using AI-generated voices.

“I’ve never seen any new technology, new business, where the people that created it have been more worried about how you use it,” he said. “They’re worried that if they’re going to get any monetary value out of it, they are going to have to make sure it’s well-regulated.”

“I just think there’s no way that AI can go unchecked, and I’m glad to see the people … on the forefront are thinking the same way,” he said.

Reference: Fox News (May 18, 2023) “AI ‘voice clone’ scams increasingly hitting elderly Americans, senators warn”

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