Authors: Keith Stevens & William Browning
Single Premium Immediate Pay Annuities are a valuable tool in planning for Medicaid eligibility when a spouse requires nursing home care. These instruments can provide additional income, not just in the short-term, but in the long-term, and reduce the “spend-down” required for Medicaid eligibility.
It is important that the attorney involved in these cases work with your financial planner or tax consultant. Having your trusted advisor involved in this process ensures that the underlying structure is appropriate for you and also protects you from paying excessive commissions.
Some law firms now have financial advisors within their office and through seminars they sell these annuities. The annuities which they sell are often not the best product, nor are they likely to advise you as to the downsides to these annuities (as they are receiving a commission, directly or indirectly). Further, commissions for better companies such as Nationwide, Pacific Life and New York Life, are very reasonable and likely in the 2% range. Annuities for some of the lower rated companies can be as high as 10%.
At Isaac Wiles, we have been instrumental in writing the law which allows for these protections. If you have been to a seminar, the materials or cases which they refer to are likely our cases. We are can assist you in planning and should the need arise, in the courtroom. With Isaac Wiles, we encourage you to maintain your long-term relationships with your family attorney, accountant, and financial advisor.