Navigating Housing Options for Seniors

Can you explain the different types of housing options available and recommend some good resources for locating them? I need to find a place for my parent and could use some help.

There is a wide array of housing options available, but what is appropriate for your parent will depend on their needs and financial situation. Here is a rundown of the different levels of housing and some resources to help you choose one.

Independent living: If your parent is in relatively good health and self-sufficient, "independent living communities" are a top option that can offer a sense of community. This type of housing is usually apartments or town homes that are fully functional and are typically available to people over the age of 55. In addition, many communities also offer amenities such as meals served in a common dining area, housekeeping, transportation and a variety of social activities.

To locate this type of housing, contact your local Area Agency on Aging. You can locate their contact information by using your favorite search engine. Most of these communities are private pay only and can vary greatly in cost ranging anywhere between $1,500 to $6,000 per month.

Assisted living: If your parent needs help with daily living chores, they will probably need an "assisted living facility." These facilities provide help with the activities of daily living – like bathing, dressing, eating, going to the bathroom – as needed, as well as meals, housekeeping, transportation, social activities and medication management. Many facilities also offer special "memory care units" for residents with dementia.

Costs for assisted living usually run between $3,000 and $6,000 per month depending on location and services needed. Most residents pay for assisted living from personal funds, while some have long-term care insurance policies. Many state Medicaid programs today also cover some assisted living costs for financially eligible residents.

Another similar, but less expensive option to look into is "board and care homes." These offer many of the same services as assisted living facilities but in a much smaller home setting.

Nursing homes: If your parent needs ongoing medical and personal care or has very limited mobility, a nursing home, which provides 24-hour skilled nursing care is the next option. To find a good one, use Medicare's nursing home compare tool at Medicare.gov/care-compare. This tool will not only help you locate nursing homes in your area, it also provides a 5-star rating system on recent health inspections, staffing, quality of care, and overall rating.

Be aware that nursing home care can be very expensive, costing anywhere between $4,500 and $13,000 per month for a semi-private room depending on where you live. Most residents pay from either personal funds, a long-term care insurance policy or through Medicaid after their savings are depleted.

Continuing-care retirement communities (CCRC's): If your parent has the financial resources, a "CCRC" is another option that provides all levels of housing (independent living, assisted living and skilled nursing home care) in one convenient location. But these communities typically require a substantial entrance fee that can range between $20,000 to $500,000 or more, plus ongoing monthly service fees that vary from $2,000 to over $4,000.

Need Help?


If you are not sure what your parent needs, consider hiring an aging life care expert who can assess your parent and find them appropriate housing for a fee – usually between $300 and $800. You can also use a senior care advising service free of charge, as these service agencies get paid from the senior living facilities in their network.

Savvy Living is written by Jim Miller, a regular contributor to the NBC Today Show and author of "The Savvy Living" book. Any links in this article are offered as a service and there is no endorsement of any product. These articles are offered as a helpful and informative service to our friends and may not always reflect this organization's official position on some topics. Jim invites you to send your senior questions to: Savvy Living, P.O. Box 5443, Norman, OK 73070.

 

Published January 7, 2022

Take Action on December Gift Opportunity

The calendar is moving rapidly toward the end of the year. There are just two weeks remaining to take advantage of the charitable gift benefit for nonitemizers or expanded charitable gift deductions for itemizers. The nonitemizer deduction permits an individual to deduct up to $300 or a married couple up to $600, but it is scheduled to expire on December 31.

Edward Killen, Deputy Commissioner of the IRS Tax Exempt and Government Entities Division stated, "We encourage people, if you are considering a donation to a charity, to do it as soon as possible before the December 31 deadline."

David Thompson is Vice President of Public Policy at the National Council of Nonprofits. He encouraged donors to use the nonitemizer deduction and stated, "At a time when nonprofits continue to see immense demand for services, are facing significant challenges hiring and retaining staff to deliver those services — every donation counts. We are thankful that the universal (or nonitemizer) deduction is available through the end of the year to encourage every taxpayer to give a little bit more to the missions they care about."

The nonitemizer deduction has been particularly beneficial for midsized organizations. These organizations have been crucial in addressing the challenges of the nation during the COVID-19 crisis.

Daniel Cardinali is President and CEO of Independent Sector. He noted, "Congress has sent a powerful message that everyone — not just those who itemize on their taxes — has a role to play in helping meet this moment, and we know people in America will respond in kind. We hope charitable contributions and deductions will increase in the coming years."

Taxpayers can use the IRS.com tax–exempt organizations tool if they wish to make sure that a charity qualifies for deduction. IRS TE/GE Commissioner Sunita Lough noted, "We see scams, fly–by–night organizations, pop–ups trying to take advantage of natural disasters because people want to give. And there are people who will try to take advantage of those who want to give and call in and ask for donations for organizations that are not tax exempt."

The non-itemizer deduction is quite important because about 9 out of 10 taxpayers take the increased standard deduction. Donors are able to benefit from both the standard deduction and the $300 or $600 nonitemizer deduction. Nonitemizer gifts must be in cash and may not be a gift of volunteer services, household items or to a donor advised fund.

Editor's Note: Generous donors who itemize may also benefit from the temporary increase in the maximum deduction limit. Cash gifts to qualified charities during 2021 are permitted up to 100% of adjusted gross income (AGI). The maximum deduction limit will be changed back to 60% for cash gifts in 2022. There are a number of generous Americans who have decided to maximize their gifts this year using the 100% of AGI charitable deduction limit.

Expand and Extend the Nonitemizer Deduction


A coalition of charitable organizations sent a December 14 letter to Senate Majority Leader Chuck Schumer, Senator Mitch McConnell, Speaker of the House Nancy Pelosi and Minority Leader Kevin McCarthy.

The Charitable Giving Coalition (CGC) represents thousands of charitable and faith–based organizations. The organization wrote to urge the Senators and Representatives "to expand and extend the nonitemizer charitable deduction as thousands of nonprofits continue to play an integral role in the response to recovery from the COVID–19 pandemic."

The Association of Fundraising Professionals Fundraising Effectiveness Project (FEP) report analyzed the benefits of the $300 universal charitable deduction. This above-the-line deduction was initially passed in the bipartisan CARES Act and was extended to year 2021.

The FEP shows a 15.3% increase in 2020 donations of $250 or less. This was a larger increase than existed for gifts over $250. There also was a 28% increase in gifts of $300 on December 31 of the past year. This is the exact amount of the universal charitable deduction. It seems probable that these gifts were the result of the incentive of the $300 universal deduction.

The coalition stated, "We continue to support the Universal Giving Pandemic Response and Recovery Act (S. 618, H.R. 1704), bipartisan legislation which would raise the $300/$600 cap on the nonitemizer charitable deduction to roughly $4,000 for individuals and $8,000 for couples." The Coalition explains that these gifts from millions of Americans are essential for charities to assist or to support communities and individuals with critical needs.

The nonitemizer deduction is scheduled to expire on December 31. If it lapses, there will be reduced donor support during 2022, particularly for midsized and smaller nonprofits. The Coalition concludes, "We urge you to expand and extend the nonitemizer universal charitable deduction in year–end legislation."

Editor's Note: The universal charitable deduction is not included in the current Build Back Better Act or other legislation. Because the House has adjourned and the Senate is likely to defer major legislation until the next year, the prospects for extending the nonitemizer deduction before the end of the year are low. However, it is possible that the nonitemizer deduction could be included in new legislation next year.

Updated IRS Tax Exempt Organization Search Tool


In IR–2021–250 the Internal Revenue Service announced that it is upgrading website services to disclose electronically-filed IRS Forms 990. The new services will be available on the Tax Exempt Organization Search webpage.

Previously, the IRS maintained the Form 990 Series data on Amazon Web Services. The change will now involve the IRS maintaining the data on IRS.gov on the Charities and Nonprofits webpage.

The Tax Exempt Organization Search Bulk Data Downloads webpage enables any individual to access the information. On the "Search Bulk Data Downloads" webpage, the user must choose a data set and download a compressed zip file. The webpage warns, "It is a large file."

The zip file will include the PDFs of IRS Forms 990. It is also possible to download a zip file of the qualified charitable organizations under Publication 78.

Editor's Note: The IRS continues to update its files to permit the download of charitable information. It is developing search tools that will allow it to provide the data in a manner similar to the nonprofit organizations that have historically made Forms 990 available. The IRS website is steadily becoming more search–friendly, but it still will require major modifications to make the data more easily accessible.

Applicable Federal Rate of 1.6% for January -- Rev. Rul. 2022-1; 2022-2 IRB 1 (15 Dec 2021)


The IRS has announced the Applicable Federal Rate (AFR) for January of 2022. The AFR under Section 7520 for the month of January is 1.6%. The rates for December of 1.6% or November of 1.4% also may be used. The highest AFR is beneficial for charitable deductions of remainder interests. The lowest AFR is best for lead trusts and life estate reserved agreements. With a gift annuity, if the annuitant desires greater tax-free payments the lowest AFR is preferable. During 2022, pooled income funds in existence less than three tax years must use a 1.6% deemed rate of return.

Pill Splitting: Tips to Discuss with Your Doctor

When is it safe, or not safe, to split pills? I have a cousin who cuts almost all her pills in half in order to save money, but I am wondering if she is going overboard. What can you tell me about this?

The practice of cutting pills in half or "pill splitting" has long been a popular way to save on medication costs. However, it is imperative to talk to a doctor or pharmacist before trying this because not all pills should be split.

The reason pill splitting may be a cost saver is because of the way drugs are manufactured and priced. A pill that is twice as strong as another may not be twice the price. In fact, it may be similar in price. So, buying a double-strength dose and cutting it in half may allow you to get two months' worth of medicine for the price of one. But is it safe? If your doctor agrees that splitting your pills is safe for you and instructs you how to do it properly, this may be a helpful idea to consider.

Ask Your Doctor


If you are interested in splitting your pills, talk to your doctor or pharmacist to find out if any of the medications you use can be safely split. It is also important to find out whether splitting them will save you enough money to justify the hassle.

The pills that are easiest to split are those with a score down the middle. However, not every pill that is scored is meant to be split. Some types of pills that can potentially be split are cholesterol lowering drugs, antidepressants and high blood pressure medicines.

Use a Pill Splitter


Having the right equipment is very important too. Do not use a knife or scissors to cut your pills in half. These tools may cause you to split pills unevenly, resulting in two pieces with very different dosages. This variation in doses might be dangerous. Purchase a proper pill cutter that has a cover and a V-shaped pill grip that holds the pill securely in place. You can find them at most pharmacies for $5 to $10.

For convenience, you might be tempted to split the whole bottle of pills at once. However, your doctor or pharmacist may suggest it is best to do the splitting on the day you take the first half, and then take the other half on the second day or whenever you are scheduled to take your next dose. That will help keep the drugs from deteriorating due to exposure to heat, moisture or air. It is also important to know that pills are only safely split in half, and never into smaller portions such as into thirds or quarters.

Do Not Split These Drugs


Some pills should never be split. Drugs that are time-released or long-lasting and tablets that contain a combination of drugs probably should not be split, because it is difficult to ensure a proper amount of active ingredients in each half. Pills with a coating to protect your stomach, and pills that crumble easily or irritate your mouth should not be split either. Other drugs that should not be split include chemotherapy drugs, anti-seizure medicines, birth control pills and capsules containing powders or gels.

Once again, your doctor or pharmacist will know which drugs can and cannot be split. If you are taking a medicine that can be split, talk to your doctor about getting your prescription adjusted. Then you can start safely splitting pills and saving money.

Savvy Living is written by Jim Miller, a regular contributor to the NBC Today Show and author of "The Savvy Living" book. Any links in this article are offered as a service and there is no endorsement of any product. These articles are offered as a helpful and informative service to our friends and may not always reflect this organization's official position on some topics. Jim invites you to send your senior questions to: Savvy Living, P.O. Box 5443, Norman, OK 73070.

Protect Yourself From Holiday Scams

 

During the holiday season, the Internal Revenue Service and its Security Summit Partners warns consumers to protect themselves from potential identity thieves. This is a season for online shopping and an abundance of emails or texts from friends and family.

IRS Commissioner Chuck Rettig stated, "Do not let this be the most wonderful time of the year for identity thieves. The approach of the holidays and tax season increases risk for taxpayers and opportunities for criminals. We urge people to be extra careful with their personal and financial information during this period while shopping online or getting suspicious emails or text. Taking a few simple steps can keep people from becoming victims of identity theft and protect their sensitive personal information needed for tax returns and refunds."

The Security Summit partners caution that identity thieves continue to update and enhance their strategies. Scammers are always attempting to obtain personal and sensitive information. This information may then be used to file a fraudulent tax return and claim a refund.

The IRS offered some useful security tips for the holiday season.
  1. Security Software — All computers, tablets and mobile phones should have security software that is regularly updated, as well as anti-virus software that protects against malware. Parents should also be cautious with the electronic devices of teens and younger children.
  2. Phishing Scams — The number one way identity thieves steal personal data is through emails that contain phishing links. If you do not know the sender, do not open a link or click on an attachment. Many of the phishing emails this year continue to focus on COVID-19, Economic Impact Payments or the latest tax legislation.
  3. Strong Passwords — You should use strong passwords to ensure security for online accounts. Many individuals use a phrase or a series of words that can be easily remembered. An excellent alternative is to use a password manager on your smartphone to maintain unique passwords for each online account.
  4. Two-Factor Authentication — Many email providers and social media sites offer two-factor authentication. Nearly all banks and financial institutions also enable you to use this service. You will be able to enter your password and receive a code on your phone. Entering both a password and a code ensures a higher level of security.
  5. Public Wi-Fi — Be careful when using public Wi-Fi. Your home Wi-Fi normally is protected with a password. However, public Wi-Fi is frequently unsecured and identity thieves can monitor your session. This could give the scammers the opportunity to learn your logins and passwords for key accounts.
  6. Backup Files — Your computer and smartphone contain extensive information. You may want to use a cloud service or an external hard drive to backup information. You can use a search tool to search for how to backup a computer and learn about many of the options available.
  7. Virtual Private Network (VPN) — A VPN is a secure way to connect to your office network. The VPN protects the data transferred back and forth from being viewed by an identity thief.
Editor's Note: You also may want to consider viewing IRS YouTube videos. Two of the more popular videos are "Easy Steps to Protect Your Computer and Phone" and "Here is How to Avoid IRS Text Message Scams." The videos are concise and informative.

Bequests to Your Favorite Charity

Bequests to charity are the most popular type of planned gift. A donor may retain assets during life and then leave a bequest to a charity.

A bequest to a charity should include the full legal name, city and state of the charity—particularly if there are chapters of a national organization or religious organizations with similar names. An attorney who drafts the will should be certain that he or she has correctly identified the intended charity by legal name, city and state.

Specific Bequests


As a donor, you may choose to leave a specific item or amount to a charity. For example, some friends of charities have left a bequest of land or property adjacent to the campus of the charity. The usual purpose is for the charity to be able to use that property for future additions or expansion.

If you own art or a specific item that may be used by a charity for its exempt purpose, that asset may be a good choice for a specific bequest. Once again, it is important to identify the exact item and the charity by legal name, city and state. Some donors may also choose to list an alternative gift if they leave a specific bequest. If for any reason your estate no longer owns the specific bequest property at your death, you may wish to designate another item or an amount of cash to the charity.

Another option is a specific bequest of an amount of cash. This allows you to know the exact amount that will be transferred from your estate to charity. There is one planning issue to consider with a bequest of a specific amount of cash. If you transfer a specific amount of cash to a charity and your estate is much larger or much smaller than the present value, this bequest to charity may be a larger or smaller part of the estate than you intend. If this is a reasonable prospect, you may wish to leave a percentage of the estate to your favorite charity.

Gift of Part of the Residue of the Estate


After all of the specific bequests have been made and your estate costs and taxes have been paid, the balance of the estate is called the residue. You probably will choose to distribute the residue on a percentage basis. Many donors decide to leave a percentage of the residue to charity.

Some donors give charity a specific percentage, such as 5%, 10% or more. Another option is to give to all of your charities a share that is equal to the share of your children, nephews, nieces or other beneficiaries.

For example, one donor had two children and divided her estate into three shares. Each child received one share and the charities collectively divided the third share. Another parent with three children divided the estate into four shares and did the same. Treating your charities as one child and simply dividing the estate with one share for each child and one share for favorite charities is a very convenient way to benefit your favorite charities.

IRA or 401(k)


If your estate includes an IRA or 401(k) in addition to your home, CDs and other securities, you might consider a beneficiary designation to charity.

From your perspective, your IRA is a very good asset. For most IRAs, other than a Roth IRA, the plan is funded with pretax dollars. It also grows tax free. However, you or your beneficiary will pay income tax when you withdraw the funds.

For you, the IRA is an excellent plan. Everyone should have a qualified plan such as an IRA, 401(k), or other retirement plan. Your IRA is funded with pre-tax dollars and grows tax free. This is an excellent plan for your future security.

If you pass away with a fairly substantial balance in your regular IRA or 401(k), that could be an excellent opportunity to make a charitable bequest. For the vast majority of Americans who have an estate that is not subject to estate tax, the only tax paid by the family will be income tax. Your home, CDs, stocks and bonds can be transferred to children without tax.

However, if you give family members your IRA, it comes with a large "you-owe-the-IRS" tax bill attached. When children or other heirs receive your IRA, they pay tax at their highest rate on their IRA distributions. This can be a sum of many tens of thousands of dollars.

Therefore, if you are planning to leave assets to charity, the transfer of an IRA may be a good plan.

Joe is an IRA owner and was speaking with his tax advisor Harry about the options for leaving a bequest to his favorite charity.

Joe: "Harry, I've been thinking about leaving a bequest to charity. You know, I've always thought that I would leave most of my estate to my two nephews and three nieces. But as I've thought about it, I have supported my favorite charity for many years and would like to do something for them."

Harry: "Well, you have a home, some CDs, some stocks and bonds and your IRA. Right now, the other assets are worth about $600,000 in total and your IRA is $200,000. How much were you thinking of leaving to the charity?"

Joe: "I thought I would give them about one-fourth of the estate and transfer the rest to my five nieces and nephews."

Harry: "You know, Joe, if you give them the home, stocks and bonds and CDs they will pay zero estate and income tax. But if you give them the IRA, they would have to pay income tax. A better plan might be to give the IRA to charity. Because a charity is tax exempt, it doesn't pay the income tax. In your case, that's a savings of over $60,000."

Joe: "That sounds like a great idea. How do I make that gift?"

Harry: "Your IRA is transferred by a beneficiary designation. We will obtain the form from your IRA custodian and designate your favorite charity. The nice part about a beneficiary designation is that it avoids probate."

Bequest for a Purpose


A bequest of assets through a will, a revocable living trust, or a beneficiary designation of a retirement plan also enables you to select a purpose. In most cases, donors simply leave a bequest for the general purposes of the charity. Because your bequest may occur many years after you sign your will, it is good to give the board of directors of the charity opportunity to select the best and most effective use of the bequest.

However, if you wish to benefit a specific area within your favorite charity, that is perfectly fine. You may designate the purpose for the use of your funds. In selecting a purpose, it is still best to give a general category for the use of the funds, so that the organization can continue to make the best possible use of your bequest.

Social Security Calculators That Can Help You Decide When to Claim

Can you suggest some good resources that can help my spouse and I determine the best age to start collecting our Social Security retirement benefits?

Deciding when to start collecting your Social Security benefits can be one of the most complicated and consequential decisions in retirement. Depending on the age you start benefits, it may cost you and your spouse tens of thousands of dollars over your retirement. Doing your due diligence now is a very smart and responsible move.

Factors to Consider


You can claim Social Security benefits any time between the ages of 62 and 70. Each year you wait increases your benefits between 5% to 8%. However, there are other factors to consider to make an informed decision. For example, you may consider your health and family longevity, whether you plan to work in retirement along with spousal and survivor benefits.

Note that Social Security Administration claims specialists are not trained or authorized to provide you with personal advice on when you should start withdrawing your benefits. They can only provide you with information on how the system works under different circumstances. To further educate yourself, you will need to turn to other sources.

Online Tools


The first step in deciding when to claim your Social Security benefits is to go to SSA.gov/myaccount. Through your account, you can access a personalized statement that estimates what your retirement benefits will be at ages 62 through 70. These estimates are based on your yearly earnings, which are also listed on your report.

Once you get estimates for both you and your spouse, there are a number of online Social Security strategy calculators that can help you compare your options. You can locate these calculators by searching for them using your preferred search engine. Some of these tools may be free, whereas others may charge a fee. Some calculators provide comparisons of the total projected benefits over time, based on the age at which benefits are first claimed. These tools may also provide some insights as to how benefits may change based on tax filing status.

In-Person Advice


You may also be able to get help through a financial planner. You may wish to look for someone who is a certified financial planner (CFP). Some CFPs operate on a fee-only or hourly basis cost structure. You can locate a CFP by searching for them using your preferred search engine. To find someone, use the National Association of Personal Financial Advisors online directory at NAPFA.org.

Savvy Living is written by Jim Miller, a regular contributor to the NBC Today Show and author of "The Savvy Living" book. Any links in this article are offered as a service and there is no endorsement of any product. These articles are offered as a helpful and informative service to our friends and may not always reflect this organization's official position on some topics. Jim invites you to send your senior questions to: Savvy Living, P.O. Box 5443, Norman, OK 73070.

 

Published December 3, 2021

Online Accounts

Online Accounts

 
At any given time, the average American maintains between 30 and 50 online accounts. These may be with banks, financial institutions, utility companies, email providers, social media outlets, commercial shopping or travel sites and accounts unique to technology such as an account to purchase apps for a smartphone.

Modern estate plans should include an "ePlan" to manage online accounts and online data. There are four specific steps to creating an effective ePlan. These include compiling a list of each account along with an explanation of how each is used; developing a plan for storing electronic information; naming an executor to manage the accounts; and providing appropriate direction to your executor.

1. Compile a List of Accounts and How to Access Them


The first part of an effective ePlan is to gather information and to compile a list of your accounts together with information about the accounts. Your list should specify the username, password account number and a description of what is included in each account. Because passwords frequently change, you should be sure to keep this list up to date.

There are four major types of online accounts: personal, financial, business and social media. Examples of personal accounts include email accounts and those used in conjunction with photos, videos, music and apps for smartphones or tablets. The information associated with these accounts is typically backed up on a computer hard drive, a backup drive or cloud account.

Financial accounts might include savings and checking accounts, retirement accounts, utility accounts, and accounts related to travel and shopping. Increasingly, people are using electronic devices to bank online, including linking accounts for automatic payments, to manage retirement and investment accounts, and to shop online at sites such as Amazon, eBay, airlines and other companies. Online financial accounts also allow for the management of digital currency such as Bitcoin. In many cases, the estate executor will need the account holder’s username, password and account number to identify and access any online financial accounts and to ensure that they can be left to family.

Business related accounts could include intellectual property that is part of a website or blog, including written work, photos, videos and musical compositions and software. If you own business assets like these, be sure to discuss these specific assets with your attorney.

Examples of social media accounts are Facebook, Twitter, and LinkedIn. These accounts may be valuable or sufficiently sentimental because they contain photos and comments that should be passed on to family. A good ePlan will instruct the executor how to dispose of these assets, such as whether the executor should copy the data from these accounts to share with family and whether to wind down and close these accounts.

2. Store and Protect Your Information


The second part of an effective ePlan is the development of a plan for storing information. This will involve saving the list that you compiled as well as backing up important data files and account information.

Because an ePlan account list contains sensitive information such as usernames and passwords, it is essential to maintain the security and confidentiality of this list. There are three basic options for securing an ePlan account list. First, this list could be handwritten and stored in a safe place. Second, it could be in electronic format such as a spreadsheet saved to a thumb drive. Extra security measures can be taken to password protect or encrypt the file or drive. Third, there are programs that manage, save and encrypt passwords. These programs allow people to connect multiple devices to a password management program and the program will keep the passwords up to date on each device. If you password protect a file, encrypt a drive or use a password management program, be sure to provide your executor or a loved one with the file password or encryption key or with access to one of your devices so your executor can access the password program.

For purposes of security, and in order to keep the list up to date, maintain a single list. Avoid saving the list on a computer in case of data loss or a data breach. Do not include this list in a will or living trust; these documents may become public. Save the list in a secure location such as in a locked, fireproof home safe or safety deposit box. Some states require that a safety deposit box cannot be opened after the owner passes away without the approval of the probate court. Ask your attorney if you live in one of these states. If you do, consider storing your list in a home safe.

There are several options for maintaining a backup of important electronic information such as pictures, videos, music and archived email. You can back up this information on your personal computer, in a cloud account or on an external backup drive, thumb drive or DVD, which can then be stored in a home safe or safety deposit box.

3. Select Your Digital Executor


After compiling a list and selecting a storage method, the third part of an ePlan will be the selection of a digital executor. Many states have passed laws that give access to online accounts to the executor of an estate. In some cases, however, state law may limit access if the executor does not have the password or an estate plan does not clearly grant powers to the executor to access these accounts. Accordingly, your estate plan should be explicit in the granting of authority with respect to online accounts, and the ePlan should provide the necessary passwords to the executor. Institutions that provide online account access may give the executor access upon a showing of appropriate authorization in the estate plan or, in some cases, may require an order from the probate court. For some accounts such as Bitcoin, the executor will need the password to access the account.

4. Provide Your Executor with "Digital Directions"


The fourth and final part of an ePlan includes a letter of instruction to the digital executor. This letter will tell the executor how to manage your online accounts and digital assets. It may also provide recommendations for the distribution of various accounts, assets, files and information to family. Information in personal accounts, such as photos and videos, can easily be duplicated. Accordingly, the letter may instruct the executor to produce copies of those files to share broadly with family. Assets in any financial accounts will be transferred to your chosen heirs according to your will, trust or beneficiary designation form, after which the financial institutions will close your accounts. A letter can also tell the executor how to manage social media accounts. Options for dealing with social media accounts include transferring account management to a loved one so that the account can remain active and serve as a memorial to the original account holder, or the account can simply be closed down.

Account Specific Information


Google, Facebook, Twitter, Apple and other companies have adopted policies to address the situation when an account holder has passed away. These policies may allow an account holder to designate a "Legacy Contact" to manage the account; require specific documentation before a deceased person’s account can be closed, such as a copy of a death certificate, court order, notarized letter or obituary; or automatically close an account after an extended period of inactivity, such as three to twelve months. These policies are subject to change, so a digital executor should familiarize themselves with the policies of each account provider and may need to act quickly to preserve important and sentimental information for family and loved ones.

Protect Your Digital Assets


Digital estate planning is a new and rapidly changing field. By incorporating an ePlan into your estate plan, you can ensure that your executor will take the right steps to preserve and protect these accounts and that valuable and sentimental data can be passed on to family and loved ones.

 

Published November 27, 2020

How to Manage Medications

My 75-year-old mother is currently taking 16 different prescription and OTC medications and I'm worried she's taking way too many drugs. Can you suggest any resources that can help us?

Unfortunately, millions of older Americans are taking way too many medications today, which raises their risk of dangerous side effects and drug interactions.

According to the American Society of Consultant Pharmacists, people aged 65 to 69 take an average of 15 prescriptions a year, and those aged 80 to 84 take 18 prescriptions a year. That is in addition to the myriad of over-the-counter drugs, herbal remedies, vitamins and minerals they may take, any of which – alone or in combination – could cause more problems than they cure.

Even when older patients are taking only necessary and effective drugs, the dosages need a second look. As patients age, they tend to metabolize drugs more slowly, meaning the dose that was perfect five years ago may now be too high, perhaps causing dizziness and falls. Doses may need to be continually adjusted with age.

Get a Drug Review


If you have concerns or questions about the medications your mother is taking, gather up all her pill bottles, including her prescription and over-the-counter drugs as well as vitamins and supplements, put them in a bag, and take them to her primary physician or pharmacist for a comprehensive drug review.

Medicare provides free drug reviews with a doctor during annual "wellness visits," and many Medicare Part D prescription drug beneficiaries can also get free reviews from pharmacists.

At the review, go through each medication and find out if there are any duplicate medications or potentially dangerous combinations. You should also ask if there are any drugs she could stop taking or reduce the dosage. Then, make a medication master list with dosages and keep it updated so it can be easily shared whenever your mom sees a doctor. To help with this, you may find some helpful medication forms or smartphone applications through your favorite search engine.

Other Tips


If possible, your mom should also use a single pharmacy to fill all her prescriptions. The software that pharmacies use to manage patient prescriptions is designed to cross reference all medications a patient is taking to ensure that there are no drug interactions that could cause harm.

Also, the next time your mom's doctor prescribes a new medication, she should ask about nondrug treatment options that might be safer. If the drug is indeed necessary, she needs to find out how long she is supposed to take it and any potential side effects it can cause.

Another good resource that can help keep your mom safe is the American Geriatrics Society, which has identified 10 different types of medications that people 65 and older should almost always avoid because of the risk of serious side effects. They include the anti-anxiety drugs diazepam (Valium) and alprazolam (Xanax), and sleep drugs such as zolpidem (Ambien) and eszopiclone (Lunesta). To see the complete list, visit HealthInAging.org and search "10 medications older adults should avoid."

Savvy Living is written by Jim Miller, a regular contributor to the NBC Today Show and author of "The Savvy Living" book. Any links in this article are offered as a service and there is no endorsement of any product. These articles are offered as a helpful and informative service to our friends and may not always reflect this organization's official position on some topics. Jim invites you to send your senior questions to: Savvy Living, P.O. Box 5443, Norman, OK 73070.

 

Published November 26, 2021

Does Medicare Cover Mobility Scooters or Wheelchairs?

I have arthritis in my hips and knees and have a difficult time getting around. What do I need to do to get a Medicare-covered electric-powered scooter or wheelchair?

If you are enrolled in Medicare, getting an electric-powered mobility scooter or wheelchair that is covered by Medicare starts with a visit to your doctor's office.

If you are eligible for this benefit, Medicare will pay 80% of the cost after you have met your Part B deductible ($203 in 2021). You will be responsible for the remaining 20% unless you have supplemental insurance. Here is a breakdown of how it works.

Schedule an Appointment


Your first step is to contact your primary care provider and schedule a mandatory face-to-face mobility evaluation to determine your need for a power scooter or wheelchair. To be eligible, you will need to meet all of the following conditions:
  • Your health condition makes moving around your home very difficult, even with the help of a cane, crutch, walker or manual wheelchair.
  • You have significant problems performing activities of daily living like bathing, dressing, getting in or out of a bed or chair, or using the bathroom.
  • You are able to safely operate, and get on and off the scooter or wheelchair, or have someone with you who is always available to help you safely use the device.
If eligible, your doctor will determine what kind of mobility equipment you will need based on your condition, abilities and home environment. If your mobility needs are only for when you are outside of your home, the equipment may not be considered medically necessary and will not qualify for the benefit.

Where to Buy


If your doctor determines you need a power scooter or wheelchair, your doctor will fill out a written order or prescription. Once you receive it, you will need to take it to a Medicare approved supplier within 45 days. To find Medicare approved suppliers in your area, visit Medicare.gov/medical-equipment-suppliers or call 800-633-4227.

There are, however, circumstances where you may need "prior authorization" for certain types of power wheelchairs. In this case, you will need permission from Medicare before you can get one.

Financial Aid


If you have a Medicare supplemental (Medigap) policy, it may cover some or all of the 20% cost of the scooter or wheelchair that is not covered by Medicare. If you do not have supplemental insurance and cannot afford the 20%, you may be able to get help through Medicare Savings Programs. Call your local Medicaid office for eligibility information.

If you find that you are not eligible or cannot afford a Medicare covered scooter or wheelchair, you may consider renting a mobility device as a short-term solution. Talk to a supplier about this option.

For more information about power mobility devices call Medicare at 800-633-4227 or visit Medicare.gov/coverage/wheelchairs-scooters.

Medicare Advantage


If you happen to have a Medicare Advantage plan (like an HMO or PPO), you will need to call your plan to find out the specific steps you need to take to get a power-wheelchair or scooter. Many Advantage plans require you to use specific suppliers within the plan's network.

Savvy Living is written by Jim Miller, a regular contributor to the NBC Today Show and author of "The Savvy Living" book. Any links in this article are offered as a service and there is no endorsement of any product. These articles are offered as a helpful and informative service to our friends and may not always reflect this organization's official position on some topics. Jim invites you to send your senior questions to: Savvy Living, P.O. Box 5443, Norman, OK 73070.

 

Published November 19, 2021

Ten Reasons to Update Your Estate Plan

 

You have completed a will and perhaps a revocable living trust. Your durable power of attorney for healthcare and a living will are in place. All of your records are safely in place and carefully organized.

So you now are finished with your estate planning. Or are you? Will there be changes in your circumstances or your family that should lead to a review of your plan? Could some events cause you to need to revise or update the plan?

Yes, there are a number of reasons to consider revising or updating your plan. These include any of the following reasons:

1. New Children, Grandchildren or Other Heirs


Your estate plan almost certainly makes provision for children and other heirs who are living when you pass away. If you have a specific transfer to one child, a new child may receive a smaller than intended inheritance.

For example, John Smith had a $1 million estate and left a $400,000 residence to child A. He then divided the balance of the estate with 1/6 of the balance to child A and 5/6 to child B. If a third child is born, depending upon state law, the child might receive nothing or perhaps would benefit from a portion of the residue. In either case, the uncertainty could lead to estate litigation or to family strife.

If you have a sizeable estate and there are large specific bequests, the arrival of a new heir is a good time to review your plan. One option is to transfer assets to the heirs "then living" when you pass away.

If the estate is $1 million, in some states a child C who is born later would receive 1/3 of the estate. This could dramatically change the benefit for child B and leave her with a reduced inheritance. In addition, child C could be a minor or a very young adult and not be capable of managing his or her property. For several reasons, the arrival of a new heir makes a review of your plan very important.

2. Move to a Different State


If you are married and move to a different state, there may be a change in the laws that affect ownership. Some states are called "common law" property states and some are "community property." If you move from one state to another and change in either direction, it may be important to clarify the ownership of your property as separate property or joint property.

For individuals with moderate to larger estates, there could be significant estate or inheritance taxes. Several states have inheritance taxes that will apply at lower levels than the federal exemption per person. Depending on who among your relatives receives your property, a new state may have a substantial tax.

Finally, many states have specific rules on durable powers of attorney for healthcare, living wills or advance directives. If you acquire permanent legal residence in the state, your doctors will expect that your medical planning documents reflect their state law.

3. Sale or Purchase of a Major Asset


You may have a major real estate asset or a business that is to be transferred to one of your heirs. If that property is sold or substantially increases in value, your entire plan could change. For example, if a property greatly increases in value and there is a large estate tax that is paid out of the residue of your estate, the beneficiary of that specific property could receive a much larger inheritance than you intend. Those children or other heirs who are receiving the residue could find their inheritance greatly reduced by estate tax paid on the asset transferred to the first child.

Alternatively, if the first asset is sold, then a child may receive a smaller than intended inheritance. Therefore, a significant sale or purchase is a good time for an estate planning review.

4. Reaching Age 72


The four types of estate property are generally cash and cash equivalents, stocks, real estate and qualified plans. Over the years, your qualified retirement plan may become a large portion of your estate. Your IRA, 401(k) or other qualified plan will require distributions to start on April 1 of the year after you reach age 72.

If you pass away before the entire plan is paid out to you during your retirement years, the balance is transferred to your designated beneficiary. Because retirement plans have grown substantially over the past decade, it's very important to review your beneficiary designations. Many individuals pass away and the plan value is transferred to beneficiaries who have been selected 10, 15, and even 25 years earlier. There could be many reasons why you would want to update that beneficiary designation, and age 72 is a logical time to do so.

5. Your Selected Beneficiary is Deceased


In many families there are unmarried brothers or sisters. It is quite common for these individuals to receive an inheritance and to remember the surviving brothers and sisters in their plans. However, even if there are two or three unmarried brothers or sisters, one will inevitably be the survivor and hold most of the assets. If you are remembering a sibling in your plan, there is a substantial possibility that he or she will pass away before you do. In that case, it is useful to revise the plan and select a new recipient of that share of your estate.

6. Divorce or Remarriage


Estate plans for single persons are quite different from those of married couples. A single person who transfers assets to a former spouse will not qualify for the unlimited marital deduction. While property settlements are typically handled during the dissolution of marriage proceedings, there are many cases where individuals forget to change beneficiary designations on retirement plans and insurance policies. If an individual later remarries and is survived by their new spouse, there is a high likelihood of litigation between the ex-spouse and the new spouse if the individual forgot to update his or her beneficiary designations. Therefore, this person's plan and beneficiary designations should always be reviewed in the event of a divorce or remarriage.

7. Substantial Change in Value


If someone's estate increases or decreases significantly in value, there can be major impact on beneficiaries. For example, Mary has children Anne, Bob and Charlie. She leaves a home valued at $300,000 to Anne, a farm valued at $400,000 to Bob and the liquid assets to Charlie, who has the greatest financial need. While Mary is in a nursing home and no longer able to change the will, oil is discovered on the farm. When she passes away, Bob receives the farm, not worth $400,000 but $8 million.

8. Adding a Major Property to a Living Trust


If you have a substantial estate, you may hold your real estate in a living trust. If you invest in real estate or acquire a major new property and transfer that to the living trust, it will be useful to review the plan. In some circumstances, there may be different beneficiaries for the living trust than for your qualified plans and life insurance. The addition of a high value asset to the living trust could increase the benefits for the persons receiving shares from the trust in comparison to the rest of your heirs.

9. Selected Executor or Trustee Not Available


With a will or a revocable living trust, you may also select a successor executor or trustee. While this usually will handle the situation in which the primary executor or trustee predeceases you, it still is useful to review your plan if one of these persons passes away. You can easily select a new primary executor or trustee with an appropriate backup person.

10. Passage of Time


Estate plans are affected by changes in your asset value, by changes in your family, and potentially by changes in federal or state law. Therefore, it is useful every three to five years for you to sit down with your attorney and review your plan. Given all the potential areas that can change, it's quite likely that you may wish to modify some portion of the plan.

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