If you have decided to move assets out of your name, you’ll want to think carefully about whether to transfer your assets to an individual or to a trust. Medicaid won’t care, but it could be a very important decision for you.
If you are thinking of an individual, then of course you’ll want to pick someone who is honest and responsible. You probably already have someone in mind who you trust completely. However, there other risks involved. What if that person incurs an unexpected liability, which exposes your money to his or her creditor? What if that person subsequently gets divorced, or dies? If you are not comfortable with these kinds of risks, then you may want to consider a trust.
A trust is a separate “person” legally, but it is not going to incur liabilities, get divorced, or die. The risks associated with individual persons do exist with trusts. A trust will protect your assets, and it provides many other advantages as well. I’ll discuss trusts in more detail in another video – take a look at the one called “What is a Medicaid Trust?”