The cost of care later in life can have a significant impact on how much of your estate will pass to the people and causes you care about. If you find yourself unable to continue living at home, this may substantially reduce your children and grandchildren’s inheritance.
Here, our Estate Planning Solicitors provide guidance on how your contribution to care costs are calculated and the steps you can take to protect your wealth.
This will depend on the assets you have at the time you are moving into a care home. If your assets are significantly more than £23,250, you will likely have to cover your own care home fees. What is considered “significantly more than” will be determined by your local authority. This is done on a case by case basis.
If the value of your assets is between £14,250 and £23,250, the local authority might contribute towards your care costs. If your estate is valued below £14,250, your local authority should pay for your care but all of your income including some benefits and pensions will be taken into account during a financial assessment.
It is important to be aware that local authorities take a subjective approach when it comes to carrying out financial means-testing. Your personal circumstances at the time will determine what you will be required to pay.
If you have to move to a care home, the value of your property will not be taken into account if:
If you live in your house by yourself and it is solely in your name, you may be able to apply to your local authority for a deferred payment agreement, allowing you to use the value of your home to help pay for your care home costs. If approved, the local authority will help to pay your care home bills and you can delay paying the amount back until you sell your home or after your death.
You might want to think about transferring your property into a trust, gifting assets during your lifetime or make provisions in your Will creating a trust to mitigate the cost of care home fees. However, it is vital to be aware that your local authority will look to determine your intentions at the time you put any such plans in place. If you were unwell or it was clear that you would soon have to move to a care home and you decided to transfer your property to a trust, then moved into a care home shortly after that, the local authority would likely see this as an attempt to deprive them of assets. They can treat that particular asset as if you still owned it.
Getting advice early is essential, and our Estate Planning Solicitors are available now to discuss your options with you. Call us today on 0808 168 5813 or complete our online enquiry form.