Bonnie Marshall approached her estate planning and other senior legal needs exactly the way lawyers recommend: early and with an eye on the big picture.
Working with Columbia attorney Cynthia Barchet of Barchet & Jones, she put together plans for her will, her property and estate, power of attorney and advance medical directives. As the caretaker for her mother during her final years, and as a mother and grandmother in her 70s, Marshall knew it was important to make sure those details were handled — for everyone’s sake.
“If one has an attorney who can help you put these things in place, you’ve taken care of it, and you’re not leaving it for children or grandchildren to wonder about,” she says.
As more than 70 million Americans born between 1945 and 1964 enter retirement and their senior years, the need for estate planning and health care planning is higher than ever.
Like in many other areas — health care, assisted living, the job market, insurance — the aging of that baby boomer generation is having an impact on law firms in mid-Missouri and increasing demand for elder law services.
Most law firms in mid-Missouri offer some services to help meet the needs of the senior population, but a small number specialize in what’s known as elder law or special needs law.
These lawyers represent and counsel seniors on a variety of legal and financial issues, from estate planning and probate to retirement income, gift tax planning, guardianship, Medicare and Medicaid, long-term care planning, insurance and more.
Although these might seem like separate issues, they’re all interconnected when looking at a client’s financial picture, says attorney Hal Gibbs of Gibbs Pool and Turner in Jefferson City.
“There are a lot of issues going on with clients when they’re getting older,” he says. “Their kids are typically grown, they have grandkids, and you have to look at all of their total needs.”
Gibbs Pool and Turner has had an elder law focus for more than 25 years.
“There aren’t that many firms that have a significant practice in the estate planning and elder care area,” Gibbs says. “Most attorneys will tell you they can do a will or trust, but they don’t have a substantial client base in that regard.”
Gibbs says he averages about two to three estate planning clients per week in the Jefferson City and Columbia areas.
Barchet says the hardest part for most people is getting started because the complex issues can be intimidating.
“Once they get a good plan in place and understand it, it’s much easier,” she says.
Working with a lawyer who specializes in elder law was important to Marshall, who wanted someone with comprehensive expertise in all facets of seniors’ legal needs. She felt confident that Barchet had the detailed know-how to navigate a long list of potential issues.
Although she had done some planning with a previous lawyer, Marshall says she moved to Barchet after her retirement because “she will help with things you haven’t even thought of. She knows the entire situation and the ramifications of everything.”
Helping clients meet their goals for income and desires for inheritance means elder law includes not only estate planning but also asset protection.
“In our area, people own land and farms, property they know they want to go to the next generation,” Gibbs says. Seniors who want to protect those assets for children or grandchildren should consider irrevocable trusts, he says, to make sure tax penalties and probate don’t derail inheritance plans.
Asset protection is important not only to navigate tax issues and protect inheritances but also to ensure resources will be available for long-term care, medical care, end-of-life expenses and risks such as property loss or damage.
Grandparents planning for grandchildren’s needs is another growing trend in elder law, Barchet says, as people are living longer and watching younger generations move through college and into adulthood.
“We’ve seen grandparents doing a fair amount of gifting, funding college educations, establishing trusts and 529 plans for their grandchildren,” she says.
The trends driving the trend
The National Academy of Elder Law Attorneys estimates the U.S. senior population will increase to 71.5 million by 2030, making up 20 percent of the U.S. population.
In Missouri, the 65-and-over group is projected to grow by 87 percent between 2000 and 2030, reaching a total 1.4 million, or 21 percent of the state’s population, according to the state Office of Administration. The same group made up only 13 percent of the state in 2000.
By 2030, Missouri will have more than 176,000 citizens over age 85.
These increases are due to the baby boomer generation but also increased longevity due to improved health care.
That’s why demand is growing for elder law services, according to NAELA. The Missouri Bar Association also has an Elder Law Committee focused on the growing elder law trends and needs across the state.
The case for long-term care planning
Along with straightforward estate planning, which generally focuses on property, tax and inheritance plans, long-term care planning is essential for financial stability later in life.
“The longer they can plan, the more options they have,” Barchet says. “Addressing those issues early is important.”
Long-term care planning is one of the biggest trends in elder law, she says, because people are living longer, with longer retirements.
“Long-term care insurance is something that’s very difficult to get if you’re above a certain age group or have certain health issues that would restrict you,” she says.
For reasons that aren’t completely clear, Americans are reluctant to plan for long-term care needs until after their 50s or 60s, according to the National Care Planning Council, an advocacy organization that encourages education and early planning around long-term care. One reason is that it’s simply unpleasant to think about, the council says.
The NCPC estimates six in 10 people will need long-term care in their lifetime due to a complex web of circumstances including increasing longevity, smaller families, high rates of Alzheimer’s and dementia, increasing obesity trends and strained government resources, among other contributing factors.
Because long-term care insurance gets much more expensive with age, planning early is critical to ensure seniors’ financial stability if and when the need arises.
“If there are situations where people are on the bubble financially, we have to look at whether they could wind up in long-term care and whether there are assets we can protect,” Gibbs says.
The sooner the better
Planning estate and senior health care financing might not be very appealing, but it’s necessary — and the earlier the plans are in place, the better.
“You’d be surprised how many people come in in their 70s and say they need to start planning,” Gibbs says. “A lot of people do have that mindset.”
Putting trusts in place early, for example, ensures inheritances will be passed down according to the client’s wishes rather than go through probate in the case of an early or unexpected death.
In Marshall’s case, estate planning included establishing beneficiary deeds, a will, transfer-on-death (TOD) and payable-on-death (POD) stipulations and more, all with the aim of protecting her assets and simplifying the probate process for her son and grandchildren.
She first started planning more than 20 years ago, when her mother moved to the area so Marshall and her brother could provide care. She’s glad she did.
“It will be very easy for my son to just carry on and pay debts and take care of all this stuff,” she says, adding that Barchet has helped her continue fine-tuning those plans as needed. “That’s a load off my mind.”
Likewise, planning ahead early to protect financial resources for health care and long-term care needs can make a big difference later in quality of life.
“That’s what you would call proactive planning vs. reactive planning,” Gibbs says. “Reactive planning is when someone is going into the nursing home, and they haven’t done anything.”
It’s never too early to start planning, but local firms are still seeing a large number of clients coming in late in life, when plans can be more difficult and expensive to execute.
“We’re seeing more and more where it jumps up and surprises somebody because they haven’t planned for it,” Gibbs says.