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Protecting your Home and Savings

Many people feel aggrieved that, having worked all their lives, bought a home and accumulated savings to leave to their children as an inheritance, all could be lost if they are admitted into care.

Changes in the law implemented over the years will have considerable implications for the family, particularly in relation to the funding of residential care as opposed to the general feeling that people wish to preserve their wealth and hand it down to their family.

The risk of losing the family home and savings to fund residential care, at any age, is far greater than the threat of inheritance tax for most people. With inheritance tax, subject to certain exemptions and reliefs, everything you own in excess of the £325,000 (2009/10) will be subject to tax at a rate of 40% on death. On the other hand, should you be admitted into care, a local authority can take into account in a financial assessment, everything you own over £23,000 in England and Northern Ireland (Wales £22,000 and Scotland £22,500), including your home, savings and any interest you have in a business, during your lifetime.

The funding of residential care is causing a great deal of anxiety for some people, and listed below are a few typical questions that are asked in relation to funding residential care:

• I own my own home jointly with my wife, will it have to be sold to pay my care home fees?
• I sold my home three years ago and gave the money to my daughter and son-in-law to buy another house in which we are all living. Is it correct that the local authority can make my daughter and son-in-law sell up or re-mortgage their own home to fund my care?
• Can I give my home away to my children before I go into care?
• My son re-mortgaged his own home to raise money to enable me to buy my council house. Will he get the house if I go into care?
• My husband has had a stroke. I have been told that I must use my share of the savings in a joint account to support him and if I refuse, proceedings will be brought against me to recover the money I owe. Is this correct?
• I am 51 and live with my mother who has recently been admitted into care. The local authority has told me that it has put a charge on my mother’s home and if she dies before I reach the age of 60 it can apply to the court to have me removed from the property and sell it. Where do I stand?
• I am 76 and a retired farmer still holding an interest in the family business. I am now in a residential care home and the local authority has told me that my interest in the farming business will be regarded as my capital and should be used to fund the cost of my care. If this happens, the business could fail. Has my accountant been negligent in not advising me and can I make a claim against him?
• Can certain types of investments be used to protect my savings and can I insure against care home fees?
• Can my will and power of attorney be used to protect my home and savings?

Increasing wealth, a widening variety of assets, the increase in second or even third marriages, civil partnerships, children born outside the conventional family to different partners, longer retirement, and the increase in life expectancy means that planning for the future is becoming more complex.

equityCare Legal Services will give you access to a specialist Asset Protection Team who can give you information and advice on planning for the future and protecting your home and savings should you be admitted into care, including:

• Advice on funding care in your own home or in a care home.
• Local authority financial assessment procedure.
• Using your Will to protect your home and savings.
• Changing ownership of your home.
• Making gifts during your lifetime.
• Using trusts to protect your home and savings.
• Resolving disputes with local authorities.
• Applications to the Court of Protection.

For more information on asset protection and long term care, please call equityCare Legal Services direct on 01594 838940 or take a few minutes to complete our enquiry / request callback form and we will contact you as soon as possible.