Wills, Trusts, Care Homes, and Property, Your Future Plans
We solicitors talk about planning ahead a lot and whilst it may seem repetitive the message is important. If you make provision for the future now, by doing things like taking financial advice, drafting a Will or making a Power of Attorney, this can have massive benefits, both you and your loved ones later on.
It is also important to regularly review any provisions you may have already made. Changes do occur over time (both within the law and to us as individuals) and these changes may mean that you need to consider revising what you currently have in place.
As we get older our priorities change. Simple Wills made by our younger selves may not take into consideration the issues which affect us in later life. The prospect of going into a care home is non-existent to the average 35 year old, however, as the same person nears retirement and sees the effects of old age on their own family members, priorities can change.
Unfortunately the cost of care in the UK is huge, with average annual charges being somewhere in the region of £30,000 to £40,000, and there are strict rules surrounding deprivation of assets (meaning that you cannot simply give away assets or money in order to secure financial assistance from the local authority, should you have to go into care in the future).
Most people’s major asset is their home and there are ways and means to try to prevent at least part of the value of your property from being used towards care fees. If you own your property jointly with another person you may be able to draft Wills in such a way as to preserve your share of the equity for your chosen beneficiaries.
In simple terms, this would involve making sure you and your co-owner own the property in a specific way (tenants in common) so that, should one of you die, the survivor does not inherit that share in the house.
A Trust would usually be incorporated in to the Will to make sure that you still have the right to live in the property for as long as you like, but without you ever owning the whole house. If you then have to go into a care home, only the value of your own share could be used towards your fees.
We do need to take care, following implementation of the new Inheritance Tax relief which applies to residential property (and which takes effect in April of this year), because sometimes different planning options can frustrate the availability of the tax relief. This however highlights the need to take professional, comprehensive advice from a qualified Solicitor in order to obtain maximum benefit in terms of your Estate planning options.
“As a responsible firm, at Pearsons we regularly contact our clients to advise them of the need to review their Wills, and to consider any other planning options which may be helpful to them. We take a holistic, personal approach and ensure that any advice is tailored to each individual client’s needs,” said Private Client Solicitor.Subscribe to our newsletter
Please note that the information and opinions contained in this article are not intended to be comprehensive, nor to provide legal advice. No responsibility for its accuracy or correctness is assumed by Pearson Solicitors and Financial Advisers Ltd or any of its members or employees. Professional legal advice should be obtained before taking, or refraining from taking, any action as a result of this article.
This blog was posted some time ago and its contents may now be out of date. For the latest legal position relating to these issues, get in touch with the author - or make an enquiry now.