People tend to become increasingly aware of their mortality as they age. Individuals who are close to or past the age of retirement, for example, often start thinking about the support they may need if their health changes. They also have more time to reflect on their family circumstances and close relationships.
Frequently, older adults feel inspired to establish an estate plan if they have not done so already or modify an existing one. However, people may eventually reach a point where their health issues affect the validity of their estate planning decisions. They may also eventually reach a point where advance planning may not protect them as effectively as it might have if done earlier.
How late is too late when it comes to estate planning?
Elder planning is best done early
Certain types of planning require completion sooner than others. Those thinking about elder law concerns, including eligibility for Medicaid benefits, typically need to plan well in advance of their health changing.
Those applying for long-term care benefits through Medicaid usually need to make any major financial transfers and gifts at least five years before they require benefits. Otherwise, they may be subject to a penalty that could leave them without coverage when they need it the most. The sooner people recognize that they might require Medicaid benefits, the better their chances of avoiding penalties and estate recovery efforts after they die.
Late-in-life changes may face scrutiny
When it comes to establishing a legacy, testators typically retain the authority to establish or update a will for as long as they are alive. In some cases, advanced age and medical complications could undermine the efficacy of planning. If medical professionals diagnose older adults with debilitating conditions or if they display signs of cognitive decline on a regular basis, their family members may have grounds to question their estate plans in the future.
The burden of proof generally falls to those alleging that an older adult lacked the requisite testamentary capacity to establish valid documents. Those worried about their loved ones fighting over an inheritance may benefit from planning early to avoid questions about their capacity that could arise later.
Creating and routinely updating estate planning documents can help people leave a meaningful legacy and connect with appropriate support when they are vulnerable. Adults who understand the rules that limit estate planning authority are less likely to make mistakes that could lead to probate challenges that undermine their final legacy.
