Medicaid Safe Trust Plans

We all prepare for the possible, so why not plan for the inevitable?Although end-of-life expenditures often get put off for more immediate expenses, it is one that can leave your family with financial concern.

Providing for a funeral

Few people have the resources to pay for a funeral on short notice.If you rely on your friends and family to pay for your final expenses, you may be leaving behind more than heartache. Without advanced planning and funding, your loved ones may need to reach into their savings accounts, use credit cards, take out a loan, or even sell personal assets in order to pay for your final expenses. Money set aside in savings accounts may be subject to early withdrawal penalties, get tied up in probate or be depleted by long-term care expenses or nursing home fees.A wise choice to protect your loved ones is to set aside funds for your final expenses with a life insurance policy/certificate (“policy”).Final expenses may also include:

  • Monuments
  • Medical Bills
  • Credit card bills
  • Cemetery costs
  • Outstanding loans

How it works

Taking these simple steps will create a safe plan to cover these expenses.First a life insurance policy is purchased to cover the anticipated costs of your funeral. The policy is then assigned to an irrevocable funeral trust. This assignment offers two advantages:   1. At the time of death, policy proceeds avoid probate and are available immediately to pay for final expenses.   2. The policy is not considered an asset if you are determining Medicaid eligibility.3This combination of life insurance and a funeral trust provides a secure plan to cover your final expenses.

Security and protection when you need it most

The funds in the policy will be first used to pay your funeral expenses with any excess returned to your estate or beneficiary depending on the plan you choose. By irrevocably assigning your policy and permanently transferring all ownership rights to a Forethought® Trust PlanSM, you’ll receive the following benefits:

  • May give you the ability to exclude your policy as an asset in order to qualify for Medicaid and Supplemental Security Income (SSI).
  • Policy proceeds are paid to the Trust, which then pays funeral costs.
  • Funds set aside in the Trust to be used for funeral expenses are protected from creditors such as nursing homes, hospitals, lawyers, etc.
  • Proceeds used for funeral expenses will avoid probate costs and delays.
  • The policy benefit will increase with simple growth income tax-free4

Forethought® Trust Plans

Forethought Trusts have no trust fees and can be used in addition to any other trust you may already have.Forethought® Funeral Expense Trust Benefits:
  • $15,000 maximum premium amount.5
  • May protect funds from Medicaid spend-down upon effective date of transfer.
  • Policy beneficiary is the Trust.
  • The Trust pays funeral costs with any excess funds going to the estate of the insured.

Final expense planning provides the peace-of-mind needed to continue living life to the fullest. Don’t leave debt as your final gift to those you love. Guard your assets and protect the wealth you have worked so hard over the years to build for you and your family.Plan for the inevitable and save your family heartache and financial burden.


Trust Forethought when it matters most

With Forethought Life Insurance Company you can be confident your security comes first. We are proud to have served millions of consumers who have placed their trust in Forethought to help them protect their families’ financial futures. Forethought has built its reputation for more than a quarter of a century on quality service and reliability by delivering on our promises both today and in the future. For more information, please visit

Forethought.com

1 National Funeral Directors Association www.nfda.org/about-funeral-service-/trends-and-statistics.html.2 Cost of adult funeral including extra items in 2009. Source: National Funeral Directors Association.3For Medicaid spend-down purposes, consult an elder law attorney. Medicaid regulations and investment limitations may vary by state.4Growth is not guaranteed. Tax-free by IRC Code Sec. 101(a).5May vary by state.

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