Mr and Mrs Brown, came to see me a number of years ago regarding their wills. They were concerned about the cost of care fees, should they be required to pay for their care in the future.
As a result, they changed the way that they owned their house and made new wills, a standard way of preserving assets for future generations. Instead of the survivor owning all the house after the first of them died (this is called joint tenants), they now owned the house as tenants in common. Therefore, they each owned a half share in the house, which then passed into a trust in their wills on death.
The will trust gave the survivor of them a right to live in the house until death, or earlier if they could no longer reside in the house i.e. if they were required to move into a care home permanently.
Sadly, Mr Brown died. His half of the house passed into the trust in the will, and Mrs Brown continued to live in the house for a number of years. She then developed dementia and could no longer live in the house. Their daughters helped as much as they could, although they both had families of their own. Mrs Brown moved into a suitable care home, specifically designed for dementia suffers. She received an excellent standard of care, and was required to fund her own care fees (upwards of around £35,000 per annum).
The house was sold to fund Mrs Brown's care, and she lived in the care home for a number of years. Mrs Brown's half of the house was used to fund her care, but Mr Brown's share passed to his daughters in accordance with the terms of the trust set up in his will, just as Mr and Mrs Smith had intended.
With this bespoke asset protection planning, Mr and Mrs Smith protected the value of half of their house from care fees and provided a lasting legacy for their daughters. If they had not set up the will trust, most of the proceeds of sale could have been used to fund Mrs Brown's care.
Thankfully Mr and Mrs Brown also made Lasting Powers of Attorney. When the house was sold, their daughters were able to deal with all of the legal paperwork easily, and sign on behalf of their Mother, who by this time was unable to manage her finances. This didn't just involve the sale of the house, it included dealing with council tax, utilities, insurance, banks, applying for benefits and paying care fees.
If Mr and Mrs Brown had not made Lasting Powers, their daughters could not have sold the house without a Deputyship Order in the Court of Protection. This court order takes around 6 months to obtain, is administratively burdensome, and is very expensive.
It's never too early to get good advice, not only for your own peace of mind, but also for the benefit of your family members.
Contact Emma Pringle today on 01661 610 309, 0774 385 7503 or firstname.lastname@example.org for more information.