Eligibility for improved pension benefits from the Department of Veterans Affairs (VA), including housebound benefits and aid and attendance benefits, is based, in large part, upon financial need. The VA considers an applicant’s income and resources (called the allowable “net worth” of the applicant), among other factors. However, there is no formula published by the VA used to determine the applicant’s allowable net worth. The factors considered in any net worth analysis include the total household assets, total household gross income, total household unreimbursed medical expenses, and the life expectancy of the applicant. Simply stated, this means that the older the applicant, the fewer total resources he or she can own. Since life expectancy declines as the age of the applicant increases, older applicants are believed to need fewer resources to pay expenses over their remaining years of life than younger applicants.

The VA Claims Adjudication Manual M21-1MR contains more information on evaluating net worth, as follows:

Effect of Net Worth on Benefit Eligibility
If net worth is a factor for the benefit claimed, consider if it is reasonable, under all the circumstances, for the claimant to consume some of his/her estate for maintenance. If authorization makes a formal finding that the claimant’s net worth should be consumed for maintenance, deny the pension claim. Pension entitlement is based on need and that need does not exist if a claimant’s estate is of such size that he/she could use it for living  expenses.

Excessive Net Worth as a Question of Fact
No specific dollar amount can be designated as excessive net worth. What constitutes excessive net worth is a question of fact for resolution after considering the facts and circumstances in each case. A number of variables must be taken into consideration when making a net worth determination.

Factors to consider include:

• Income from other sources;
• Family expenses;
• Claimant’s life expectancy; and,
• Convertibility into cash of the assets involved.

Note: In general, the older an individual is, the smaller estate the individual requires to meet his/her financial needs. The VA pension program is not intended to protect substantial assets or build up a beneficiary’s estate for the benefit of heirs.

For more information on evaluating net worth, see M21-1MR, Part V, Subpart iii, chapter 1, section J.