Wealth Protection and Long Term Care Funding
“Half of women and a third of men will require some form of long term care” – Andy Burnham, Health Secretary, July 2009
We now live longer, but the expectation of disability free living has not increased at the same rate. 59% of the population aged 65-74 have a long standing illness which limits their activities; this figure increases to 66% once past the age of 75. This means that many people will reach the point where they can no longer live independently and will need some form of long term care.
Average care home fees throughout the UK vary in cost from around £350 to £600 per week but can rise to over £1000 per week for certain types of home providing specialist nursing care.
If the value of your investments and your home exceeds £23,250 then you will not qualify for financial assistance from the Local Authority – in other words, you are on your own until such time as your capital falls below this amount. Some support will be available if your capital is between £14,250 and £23,250 but you will only qualify for full support if the value of your capital falls below £14,250.
Many people think, wrongly, that if they give their home to their children, they can avoid paying care home fees. There are rules which prevent the giving away of assets to reduce the value of your assets. This is known as a deliberate deprivation of assets. If there is evidence to suggest that a deliberate deprivation of assets has taken place then Local Authorities have wide ranging powers to recover sums which it pays towards care from the person to whom an asset was transferred. Giving away assets before you need care can also mean that your financial independence is lost and that if you subsequently need care, your choice of home is limited. There are much better options.
As with all things, it pays to plan well in advance. We work closely with an award winning firm of independent financial advisors who specialise in providing financial advice on the funding of care home fees as well as retirement, investment and tax planning services. With them, we offer a holistic wealth protection service where we work with you and a specialist financial advisor, considering:
- Your will and whether this can be altered to make it more efficient
- Equalising assets
- Severing joint tenancies
- Welfare benefits checks
- Financial advice on maximising income from investments, equity release and planning for care home fees