57 Advertising feature Spending the kids’ inheritance on your care F


ear around care costs is probably the most frequent topic when I advise clients on later life planning.


We’re surrounded by constant media messages about living longer, and care costs always seem astronomical.


These conversations usually start from “I don’t want my house sold to pay for my care.” In my experience, starting from that worst-case position creates a lot of unnec- essary fear. Every situation is as individual as the person in front of me, but here are the points that always come up.


It’s not the kids’ inheritance yet. While you’re alive, it’s your money, not


someone else’s inheritance. Use it to ben- efit yourself. On the occasions I’ve spoken with the “kids” directly, they almost always want Mum and Dad to enjoy their money.


Care costs money - and money gives you choice. Many of us have saved throughout our lives for a rainy day. Needing specialist care is about as rainy as it gets. If you can afford to fund your own care, you, or those supporting you, have genuine choice. That might mean care at home rather than a residential setting. It might mean adap- tations to your property so you can stay there longer, or funding support for family members who would otherwise become unpaid carers. Nobody knows exactly what their care needs will be, but money keeps options open.


Transferring your home to your children (or into trust) is rarely the answer. This comes up often, largely driven by so- cial media advertising around “family pro- tection trusts.” In the vast majority of cases, transferring property to family members or into trusts is simply not appropriate. Quite apart from local authority anti-avoidance rules, if someone else owns your home, it becomes their asset. What happens if that person dies before you, is made bankrupt, or divorces? You could find yourself living


in “your” home with no legal control over it, potentially with an unwanted co-owner such as a former son or daughter-in-law.


The council won’t evict your spouse. This concern used to have more substance. In practice, if you co-own your property and go into care while your co-owner continues living there, your home is disre- garded in most care funding assessments. Your local authority is not in the business of evicting your spouse.


Start with income, not assets. Your savings and property are only there


to bridge any shortfall once your income is accounted for. If you’re in care, you’ll likely receive the State Pension and will almost certainly qualify for Attendance Allowance, together providing somewhere between £10,000 and £16,000 a year, potentially more. Add any private pension or invest- ment income on top. When planning for care costs start by deducting your income from your predicted expenditure. If your care is £1,200 per week (£60,000 per year) and your income £20,000 then your sav- ings/property contribution is not £60,000 per year, but £40,000.


Ben Darby is managing partner of Darby & Darby Solicitors in South Devon. Join Ben at the Flavel Theatre on July 2nd to discuss these issues further.


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