Trust wills and care home fees

What do you mean by a trust will?

Yes, what is a trust will ?

If you have any concerns about wills, inheritance, care home fees, ownership of your home, please consult a suitably qualified solicitor.

There are solicitors who can advise you of how to keep the bulk of your estate from being used for care home fees.

The Principle is that Local Authority can claim the cost of care from your estate including house value. If you give away any assets they can reclaim from the recipients, there is in theory no time limit on this, if they can prove you were intentionally avoiding care fees.

I think you need to be careful with trusts. My aunt and uncle had one and after they died, it cost my cousin a lot of money and trouble to sort it out.

She reckons the only people who benefited were the solicitor and the bank.

Don't you think we should pay our own care home fees before we pass any money on to the next generation?

My SiL and BiL live in Tasmania.
They needed care had to pay up front for "x" number of years.
So had to sell thier house, pay up in advance.
I can't remember for how many years in total 15 rings a bell but if they continue to live there once that's up they get reduced costs which comes out of thier pensions plus state allowances etc.
I assume if they don't do the paid time, some money goes back into the estate.

mumofmadboys

Don't you think we should pay our own care home fees before we pass any money on to the next generation?

No actually I don't.
I've worked hard paid my dues and this should be for her inheritance.
For example my grandma paid nothing because she rented all her life, the lady in the room next to her had to seen her house how is that fair?

It's 7 years for depravation of assets.

Ffoxglove

mumofmadboys

Don't you think we should pay our own care home fees before we pass any money on to the next generation?

No actually I don't.
I've worked hard paid my dues and this should be for her inheritance.
For example my grandma paid nothing because she rented all her life, the lady in the room next to her had to seen her house how is that fair?

It's 7 years for depravation of assets.

Oh dear, that is very wrong ffoxglove. Deprivation of assets has no time limit

The 7 year rule is for inheritance tax only and anything given away can be reclaimed if deprivation of assets is involved

The younger generation should not be expected to pay for someone who has, or had ,assets that will pay for their own care

on the bright side ffoxglove, having the cash from a house sale will allow you choice in what care home you might have to enter

I've worked hard paid my dues and this should be for her inheritance

Effectively what you are saying is that my children as tax payers should pay your care fees so that your daughter can inherit.

You are confusing the 7 year cut off for inheritance tax with deliberate deprivation of assets, for which there is no time limit provided the foreseeability of needing care and the intention can be proved. If they are proved then you will be assessed for care as though you still own the asset and the person receiving it is liable to pay however much you cannot.

I think your attitude is appalling. You would expect people who have not deprived themselves of assets, and the taxpayers of the day, to subsidise you so that your daughter can inherit from you. Whatever ‘dues’ you might have paid are unlikely to pay for very much care.

If you really do want to “Deprave” you assets you have to spend it on high living and gambling, problem is you never know how long you are going to live or wether you will ever need a care home.
Or indeed wether there is a change in the law whereby personal care is free (in theory) as in Scotland.

Best to stick within the rules

There are other ways but I don’t think it’s in the taxpayers’ interest for me to go into them. Suffice to say I have not taken advantage of them, nor do I intend to.

Liz46

I think you need to be careful with trusts. My aunt and uncle had one and after they died, it cost my cousin a lot of money and trouble to sort it out.

She reckons the only people who benefited were the solicitor and the bank.

Yes, a friend’s 2 dcs were left money in trust by a grandfather. It cost a bomb and took ages - evidently spun out for as long as possible by the solicitors - to wind it up.

As regards care home fees, one factor that is often overlooked is that if you do eventually need a care home (I know nobody ever wants to think of it but sometimes it’s the only practical option) then TBH being able to self fund, and to choose the time and place, is infinitely preferable to being at the tender mercies of social services who will have their own ideas about if/when it’s necessary, and of course the local authority who will be footing the bill.

Might add that councils are (understandably) typically very hot on deprivation of assets.

I have set up a trust for any money I might leave my children. It was not done to avoid paying care fees as it only applies after I have died. It was set up because my eldest son, who lives in the US, was going through a toxic divorce and I wanted to avoid his wife ( now ex) to get her hands on anything. It is also likely that he will be declared bankrupt, the family house has already been foreclosed and my son has lost his job - on going nightmare not helped by his own mis spending!

I want my younger children to decide when and how their brother gets his share ( equal shares) or they could choose not to follow my letter of intent and revoke the trust immediately and share out the inheritance - I won’t know will I? I might even change things myself if my son manages to get back control of his life.

I would never use dodgy methods to hide my assets to avoid paying care fees. My mum lives in a care home and we have been able to make the right care decisions for her without going through social services. We did not have to beg for help, undergo assessments and put up with possibly inadequate care - four brief visits a day with a career rushing in and out would not have been appropriate for someone living on their own with dementia but that’s what mum would have had to put up with. Social Services/ LA go with the cheapest care option, which is not necessarily the best one.

If we all used these tactics to avoid paying for our own care, our children would be faced with horrendous taxes to pay for it. My hard earned money is for my use, for my retirement and comfort, not for my children!

Same here, Teacheranne - we didn’t - thank goodness - need to involve SS for either my FiL or my mother. We certainly didn’t need anyone who didn’t know either of them, telling us what they needed in the way of care.

mumofmadboys

Don't you think we should pay our own care home fees before we pass any money on to the next generation?

I would agree with this if the rules applied to everyone equally; but as it is, the playing field is far from level. Whilst recognising that not everyone can afford to pay for care, and that this is not necessarily indicative of not having worked hard, the following still apply:

Those who spend as they earn get free care, whilst those who save do not.

Those who get good legal advice can protect their assets whilst those who don't can not.

Those who (through no virtue of their own) live in areas where house prices rose can leave money behind them even after care fees, whilst those who (through no fault of their own) live somewhere where prices stagnated or fell are left with nothing to pass on if they go into care.

We all know life's not fair; but if someone falls on the 'wrong' side of the situations above I can understand their wanting to try to mitigate it somehow.

Oh, and my will is not a trust one. Our solicitor advised it, but we decided that we valued choice in old age more than money.

All the same, I get sick of hearing from people who (I assume) have enough money to leave some behind deciding on behalf of those who don't that there is a moral imperative to 'pay their way'.

I don't quite understand what you say, Doodledog, in the context of this thread. The OP has something to leave behind - her house and possibly money. Are you suggesting that she should be able to give this to her daughter rather than using it to 'pay her way' if she needs care, leaving others in care who have not given away assets and the taxpayers of the day (who may have little or nothing in the way of assets through no fault of their own) to pay for her care?

Wills are totally irrelevant as they don't come into play until the testator has died.

Ffoxglove

mumofmadboys

Don't you think we should pay our own care home fees before we pass any money on to the next generation?

No actually I don't.
I've worked hard paid my dues and this should be for her inheritance.
For example my grandma paid nothing because she rented all her life, the lady in the room next to her had to seen her house how is that fair?

It's 7 years for depravation of assets.

The problem is the "dues" haven't been paid during our lifetime. We could, and some would say should, have a system that pays for care for all. But we don't.

Germanshepherdsmum

I don't quite understand what you say, Doodledog, in the context of this thread. The OP has something to leave behind - her house and possibly money. Are you suggesting that she should be able to give this to her daughter rather than using it to 'pay her way' if she needs care, leaving others in care who have not given away assets and the taxpayers of the day (who may have little or nothing in the way of assets through no fault of their own) to pay for her care?

Wills are totally irrelevant as they don't come into play until the testator has died.

I think that taxpayers should pay for everyone's care, and have their own care paid in their turn.

It would mean we all paid more tax, but would have less to pay out when (or if) we needed help.

I agree Doodledog but that isn’t the system we have now. So do you condone A giving away their assets in order to avoid paying whilst B in the next room keeps their assets in order to pay for their care and effectively subsidises A?