With the cost of care soaring, in many cases at over £1,000 per week, it doesn’t take long before the value of an estate can be eroded leaving very little for children to inherit.
When entering care, assets of the individual are means tested. Only those individuals with little or no assets will escape from having to pay for their care. Usually any assets above the value of £23,250 are taken into account when assessing an estate with regards to the cost of care.
Some important information to remember;
- If your spouse, civil partner or unmarried partner lives in your home then it is usually not counted towards your estate for care home fees
- If a relative over 60 years of age resides in the property then again it is ignored
- A property value is disregarded if a relative under the age of 60 who receives incapacity benefit or disability living allowance
- You property value will be ignored if you look after a child under the age of 16, if the property is the child’s main home
- Likewise should you home be occupied by your divorced or estranged partner and they are a lone parent with a dependent child then its value will be ignored
There are other scenarios which can also effect whether or not taken into account when assessing assets.
Protecting Your Home
A sensible option to help avoid having to sell your home to pay for care home fees is to look at how the property is owned. If held jointly with another person, then it may be better to own the property as Tenants in Common, alongside Wills and Trusts.
This way a person’s share of the property goes into trust upon death, therefore ensuing that should the remaining partner have to go into care then the property can be protected.
However what if a couple is concerned about both parties going into care at the same time? Or what if a single person wishes to protect themselves? In this case a Probate Preservation Plus Trust (PPPT) could be ideal.
By conveying a Property into Trust as part of an overall Estate Planning strategy, it is possible to protect against future care home fees. As with any planning of this nature, the effectiveness of any strategy is to implement this as soon as possible whilst there is no imminent threat of having to go into care
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it is possible to protect against future care home fees. As with any planning of this nature, the effectiveness of any strategy is to implement this as soon as possible whilst there is no imminent threat of having to go into care