SUZE ORMAN
Suze Orman is an Emmy
Award–winning TV host,
New York Times best-selling
author and motivational
speaker. She can be contacted
at
suzeorman.com.
Orman will answer selected
questions in this column.
She regrets that unpublished
questions cannot be
answered individually.
EMAIL
suze@costco.com
Please include “Suze Orman
Q&A” in the subject line.
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Q&A with Suze Orman
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FINANCIALCONNECTION
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Q My husband and I are in our ;;s. We are
both in reasonably good heath and own our
own home, mortgage-free, and have some savings. In the event that either of us becomes
incapacitated and needs to go into a nursing
home, I know it will wipe out our savings in a
short time. How can I keep most of my assets,
such as giving them to my children now, so
that I can get on Medicaid. Is it too late?
J.E., Quincy, California
A If you were to transfer your assets to your children, it may make you ineligible for Medicaid for
up to five years. What generally happens when
someone applies for Medicaid is that the government checks to see if there have been any asset
transfers within five years. This is referred to as the
“look-back” period. Transfers within this period
can make you ineligible for coverage.
One alternative you might want to
consider is selling your home and using the proceeds to finance a move into a continuing care
retirement community (CCRC). Many CCRCs
offer three tiers of living: independent, assisted
and nursing care (some even provide memory
care); residents transition to different care
when needed.
Q My husband is not working. His only
income is his Social Security check. I work.
He applied for credit cards using our household income; I did not sign on any of his credit
card applications. Will I be liable in case something happens to him or in case of default?
L.N., San Jose, California
A If you live in one of the nine community
property states (Arizona, California, Idaho,
Louisiana, Nevada, New Mexico, Texas, Wash-
ington and Wisconsin) you generally can be held
liable for any debt a spouse incurs. If you live in
another state, you generally will not be held lia-
ble for the debts of a spouse unless you explicitly
co-signed for the credit card or loan.
Q We sold our home several years ago and
have been renting. We’re ;; and would like to
either stay in Arizona or move to Colorado to
be near friends and family. We’re both in good
health and ;nancially sound. Our question is,
what makes more ;nancial sense: Rent or buy?
M.C., Tucson, Arizona
A A purely financial answer would only take into
consideration the cost of renting versus the carrying costs of owning (mortgage, property tax,
insurance and maintenance). But that’s too narrow a lens to use. The right move for you is the
one that makes the most emotional sense. A
financially sound move that leaves you feeling
edgy is in no way smart.
You say you are financially sound. I love that!
If buying a home you can truly afford makes you
feel even more financially secure, then it is
something to consider. But it sounds like you are
comfortable with renting. It gives you more flexibility to move if your circumstances change,
and, hey, at your age it might be nice to not have
to deal with maintenance issues. Just be sure the
rent you will pay today is very affordable. Over
time, rents typically rise; you want to be able to
handle increases without any financial stress.
Q I’m a ;;-year-old divorced male, ;;; percent disabled Vietnam veteran. I own my own
home and cars, all free and clear. All of my
bills are paid in full each month. My yearly
income (tax-free) is about ;;;,;;; per year,
and my net worth is just north of ;;;;,;;;.
All of my medical is paid for by Veterans
A;airs (VA). Do I need to keep paying ;;;; per
month to Social Security for Medicare? Social
Security told me they felt it would be a good
idea to continue paying it, just in case I might
need it someday. They also told me if I dropped
it and changed my mind, there would be a penalty in the cost of renewing it.
G.C., Sonoma, California
A First, thank you so much for your service. It
sounds like you have been able to get the care you
need through your local VA. That’s great. But I
think paying ;;;; a month to be eligible for
Medicare is a good “insurance” move for you. I
hope this never comes to pass, but what if at
some point you have a medical issue that would
be better treated, or perhaps treated more
promptly, if you sought care outside the VA system? Having Medicare coverage gives you the
flexibility to seek other care. C
Golden years
Planning for health, wealth and age
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