According to MSNBC, the answer is "yes," ("Is Frugal The New Black?") but only because the economy is causing belts to tighten around the country.
I suppose this is good news for everyone involved in simplifying their lives, although it may mean more competition at estate sales and thrift stores for the good finds ... but I think it forgets a large segment of the Simplicity Population.
There are many of us who have chosen to simplify our lives because of the quality of life that results from this lifestyle change. It's not all about the money, and I think this may make a big difference in how happy you are with your new frugality.
For example, this morning I awoke to the sound of the 5:30 am cannon, which I'm told is the same cannon that Fort Sam soldiers used to start the day when Geronimo was still being held in their Quadrangle. A cool breeze was coming through the windows, and I could smell the honeysuckle.
It was a nice way to start a great day. Never once did I consider that I didn't have the air conditioner going, and I didn't jump up and rush to anywhere after slamming the alarm clock off.
It did, however, make me stop and thank God for how I'm living now, versus how I lived Back Then, and it's that feeling of joy, for lack of a better word, that I find is missing from the MSNBC report.
For more information:
What Is Simplifying? Should You Do It?
Declaration Of Independence From Overconsumption
July 9, 2008
Buying a Good Used Car
With rising gas prices, a different car might be a good idea for the family budget.
Would the monthly cost of the car payment, with lower gasoline costs, outweigh your current gas bill - even if the current vehicle is paid off? As prices rise, that answer may be "yes" a lot more often.
If you want to investigate a used car (why not new? simplicity folk don't pay for the depreciation cost of driving a new car off the lot), check out the following sites:
1. Consuler Reports.org
You can read the alphabetical list of best, and worst, used cars for 2008 without cost; for details (like rankings), Consumer Reports wants you to subscribe. (Check out the ratio between foreign and domestic here, it's just sad.)
2. Forbes' Best and Worst Certified Used Cars for 2008
Forbes ranks certified used cars - those that have been retooled by the manufacturers and get extended warranties - and the Honda Accord, Toyota 4Runner, Acura TL, Subaru Impreza, and Lexus GS come out on top. Oh, and here there not "used," they're "pre-owned." Right. To be really hip, call them "CPO" - certified pre-owned.
3. The Car Connection. These are car guys and they report regularly on all things automotive. Their picks for used cars (they don't go for CPO) are: Toyota Corolla, Toyota Solara, Honda Accord, Chevy Malibu, Ford Crown Victoria/Mercury Grand Marquis, Infiniti I30, Lexus LS400, Mazda Miata, Lexus RX300 ... and because you're following a simplified lifestyle, you won't buy a Corvette or a Porsche, but you still might like to know they made the list.
July 8, 2008
Filial Responsibility Laws, Medicaid, and LongTermCare Insurance
For over forty years, a federal law (14 USC 1396(a)(17)(D)) has blocked any real enforcement of state filial responsibility laws because it outlaws states from considering the financial responsibility of anyone other than a spouse, or disabled minor child, when deciding Medicaid benefits (or other poverty-assistance program benefits). Here's what that federal law instructs the states, in part:
"do not take into account the financial responsibility of any individual for any applicant or recipient of assistance under the plan unless such applicant or recipient is such individual’s spouse or such individual’s child who is under age 21 or (with respect to States eligible to participate in the State program established under subchapter XVI of this chapter), is blind or permanently and totally disabled, or is blind or disabled as defined in section 1382c of this title (with respect to States which are not eligible to participate in such program); and provide for flexibility in the application of such standards with respect to income by taking into account, except to the extent prescribed by the Secretary, the costs (whether in the form of insurance premiums, payments made to the State under section 1396b (f)(2)(B) of this title, or otherwise and regardless of whether such costs are reimbursed under another public program of the State or political subdivision thereof) incurred for medical care or for any other type of remedial care recognized under State law"
What is Medicaid to a Senior Citizen?
Medicaid is both a federal and state program to help the poor. When the elderly exhaust their assets, and their Medicare benefits run out, then Medicaid steps in and covers their long-term care costs - as long as that care involves nursing homes or other, analogous skilled facilities. Medicaid doesn't cover home health care, or assisted living. (See 42 USC 1395(d), 1396(a), 42 CFR 409.33).
The Medicaid Estate Planning Strategy vs. Program Budget Projections
Savvy estate planners work with families regularly, and legally, moving assets out of the elderly person's estate so when incapacity comes, family inheritances are protected and Medicaid can cover the costs of care to the extent that long-term care insurance hasn't been purchased in advance. Federal law 42 USC 1396a (see above) protects the assets now held by the kids, and the parent(s) can feel secure that they will have long term care costs covered, nevertheless.
Knowing this strategy exists, federal law first allowed Medicaid to go back as far as three years to gather assets transfered from the elderly and placed into the hands of children, loved ones, or trusts. Past that 3 year mark, and the transfer was secure.
In 2005, the Deficit Reduction Act expanded that time frame to five (5) years. It also denied Medicaid nursing home coverage to anyone with home equity greater than $500,000 and allowed states to increase that amount to $750,000 within their program jurisdictions. The Act also took into account the long term insurance policy, allowing Medicaid to exempt dollar for dollar every dollar provided under the policy until it is exhausted.
Here Comes The Aging Boomer Generation
A. Reevaluation of the Filial Responsiblity Laws
As The Boomer generation ages, Medicaid will be inudated with long-term care responsibilities and program costs are expected to skyrocket. Accordingly, both federal and state officials are taking a second look at filial responsibility laws, some of which have been setting on the books for decades, as a way to deal with this impending program crisis.The National Center for Policy Analysis sees enforcement of filial responsibility laws as a good idea for the country.
B. Government-Industry Partnerships to Encourage Long-Term Care Policies
Already, insurance companies are explaining to parents and children the details of long term care costs, and the potential need to plan now for a policy. The premiums are tax-deductible as medical expenses, with the deduction amounts correlated to inflation and the elder's age.
Some states have established partnerships with long-term-care insurance companies to encourage the purchase of these premiums and avoid a future Medicaid burden. These partnerships offer those who buy long-term care policies the ability to keep a certain amount of assets and still get Medicaid nursing home coverage. There's also talk of a national partnership program.
What Does Your State Say?
The states in bold-faced type are those with civil and/or criminal filial responsibility laws on their books. Those with established insurance company partnership programs are:
California
Connecticut
Florida
Idaho
Indiana
Kansas
Minnesota
Nebraska
Nevada
New York
Virginia
States investigating these partnerships, as of Spring 2008, included:
Arkansas
Colorado
Georgia
Hawaii
Illinois
Iowa
Maryland
Massachusetts
Michigan
Missouri
Montana
North Dakota
Ohio
Pennsylvania
Rhode Island
South Dakota
Washington.
For more information:
The Tax Adviser, April 2008, "What is Long Term Care and Who Is Responsible for Its Cost?" by Dianne Odem, CPA/PFS and editor, Michael David Schulman, CPA/PFS
List of States Having Filial Responsibility Laws (statutes given)
Filial Responsibility Law - Adult Kids Sued for Care of Parents
Wikipedia, Medicaid.
"do not take into account the financial responsibility of any individual for any applicant or recipient of assistance under the plan unless such applicant or recipient is such individual’s spouse or such individual’s child who is under age 21 or (with respect to States eligible to participate in the State program established under subchapter XVI of this chapter), is blind or permanently and totally disabled, or is blind or disabled as defined in section 1382c of this title (with respect to States which are not eligible to participate in such program); and provide for flexibility in the application of such standards with respect to income by taking into account, except to the extent prescribed by the Secretary, the costs (whether in the form of insurance premiums, payments made to the State under section 1396b (f)(2)(B) of this title, or otherwise and regardless of whether such costs are reimbursed under another public program of the State or political subdivision thereof) incurred for medical care or for any other type of remedial care recognized under State law"
What is Medicaid to a Senior Citizen?
Medicaid is both a federal and state program to help the poor. When the elderly exhaust their assets, and their Medicare benefits run out, then Medicaid steps in and covers their long-term care costs - as long as that care involves nursing homes or other, analogous skilled facilities. Medicaid doesn't cover home health care, or assisted living. (See 42 USC 1395(d), 1396(a), 42 CFR 409.33).
The Medicaid Estate Planning Strategy vs. Program Budget Projections
Savvy estate planners work with families regularly, and legally, moving assets out of the elderly person's estate so when incapacity comes, family inheritances are protected and Medicaid can cover the costs of care to the extent that long-term care insurance hasn't been purchased in advance. Federal law 42 USC 1396a (see above) protects the assets now held by the kids, and the parent(s) can feel secure that they will have long term care costs covered, nevertheless.
Knowing this strategy exists, federal law first allowed Medicaid to go back as far as three years to gather assets transfered from the elderly and placed into the hands of children, loved ones, or trusts. Past that 3 year mark, and the transfer was secure.
In 2005, the Deficit Reduction Act expanded that time frame to five (5) years. It also denied Medicaid nursing home coverage to anyone with home equity greater than $500,000 and allowed states to increase that amount to $750,000 within their program jurisdictions. The Act also took into account the long term insurance policy, allowing Medicaid to exempt dollar for dollar every dollar provided under the policy until it is exhausted.
Here Comes The Aging Boomer Generation
A. Reevaluation of the Filial Responsiblity Laws
As The Boomer generation ages, Medicaid will be inudated with long-term care responsibilities and program costs are expected to skyrocket. Accordingly, both federal and state officials are taking a second look at filial responsibility laws, some of which have been setting on the books for decades, as a way to deal with this impending program crisis.The National Center for Policy Analysis sees enforcement of filial responsibility laws as a good idea for the country.
B. Government-Industry Partnerships to Encourage Long-Term Care Policies
Already, insurance companies are explaining to parents and children the details of long term care costs, and the potential need to plan now for a policy. The premiums are tax-deductible as medical expenses, with the deduction amounts correlated to inflation and the elder's age.
Some states have established partnerships with long-term-care insurance companies to encourage the purchase of these premiums and avoid a future Medicaid burden. These partnerships offer those who buy long-term care policies the ability to keep a certain amount of assets and still get Medicaid nursing home coverage. There's also talk of a national partnership program.
What Does Your State Say?
The states in bold-faced type are those with civil and/or criminal filial responsibility laws on their books. Those with established insurance company partnership programs are:
California
Connecticut
Florida
Idaho
Indiana
Kansas
Minnesota
Nebraska
Nevada
New York
Virginia
States investigating these partnerships, as of Spring 2008, included:
Arkansas
Colorado
Georgia
Hawaii
Illinois
Iowa
Maryland
Massachusetts
Michigan
Missouri
Montana
North Dakota
Ohio
Pennsylvania
Rhode Island
South Dakota
Washington.
For more information:
The Tax Adviser, April 2008, "What is Long Term Care and Who Is Responsible for Its Cost?" by Dianne Odem, CPA/PFS and editor, Michael David Schulman, CPA/PFS
List of States Having Filial Responsibility Laws (statutes given)
Filial Responsibility Law - Adult Kids Sued for Care of Parents
Wikipedia, Medicaid.
Subscribe to:
Posts (Atom)
