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 Spend-down divorce 
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Joined: Fri Feb 16, 2007 6:13 pm
Posts: 102
Location: Fayetteville, AR
Post Spend-down divorce
My wife just approached me with a subject to think about. It sort of knocked the breath out of me. She talked about a "spend-down divorce."

My wife stands to inherit around 500 acres of excellent property. The value of one 45 acre plot is almost $900,000 because it is in a fast growing area in Northwest Arkansas. The other acreage would sell for around two million at current rates. This land has been in her family for generations. Her concern is that if I end up in long-term care, she could be forced to spend-down her family's holdings. The property is currently in a living trust. It's in her name, but her parents have control over it until their death. She wants to pass the land down to our children and to their children. Also, if I die, it's the only investment she has short of a $250,000 life insurance policy. She'd need a way to provide for herself and the kids, so she might have to sell part of the land but not all of it.

She wants to know if a divorce would protect her family's land.


Wed Mar 07, 2007 6:27 pm
Profile YIM

Joined: Mon Feb 05, 2007 3:43 am
Posts: 215
Location: Seattle, WA
Sounds like an excellent question for an estate attorney; that said, I believe it would, absent an order for spousal maintenance. The rules on Medicaid and assets differ substantially from state to state though, and there may be options that protect the asset equally effectively. It depends on the nature of the trust whether or not it could be considered property acquired during the term of your marriage, and even though I'm willing to practice pharmacy without a license, I am *so* not a lawyer.

Something to consider. . . I spent several years dealing with horrible inheritance and succession-planning issues with my grandparents - before I met Jon or Cal. It was truly horrific. . . it hurt our family dynamic, it hurt the business, it cost a fortune. The vast majority of our problems could have been avoided with proper planning and a willingness to take expert advice. The biggest hurdle my grandparents needed to cross to take that advice and do the planning was to change from saying "if I die" to "when I die". I don't mean to be callous, but death remains 100% fatal to every member of homo sapiens. It is not a question of if.

Eric, As Gently As Possible

Cal is not the real name of a real 84 year old with DLB. I don't speak for LBDA, nor do I have clever initials behind my name, so information is provided without warranty. Caveat everybody. I blog at

Wed Mar 07, 2007 7:04 pm
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Joined: Mon Jun 05, 2006 3:29 pm
Posts: 93
Location: State College, PA
I strongly encourage you to seek the guidance of an Elder Law Attorney before you do anything.

All the best,

Wed Mar 07, 2007 8:33 pm
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