The BBC news website recently featured an article entitled “Trying to avoid care fees? Think twice, consumers told.”
The article states that the average cost of a place in residential care in the UK is now more than £30,000 per year. In some parts of the country, or if nursing care is required, the cost is considerably higher. If you do not qualify for NHS funding (which most people don’t), and if you have assets over £23,250, you will have to pay for this yourself. This means that you will very quickly see your life savings (including your home) disappear.
Unsurprisingly, this is a huge concern to many people. Most of us hope that we will be leaving something behind for our loved ones to inherit. It is understandable, therefore, that advertisements offering easy ways to avoid care fees attract a lot of interest. Even if the fees for setting up the scheme are high, the care fee savings could be enormous – what’s not to like?
As with most things in life, if it looks too good to be true – it probably is. The BBC news article features a story about a couple who paid a significant amount of money to a Will-writing company in the hope of protecting their home against care fees. They were badly advised and, ultimately, got no benefit from the scheme.
We were delighted to read the BBC article because it so accurately reflects conversations we have with our clients on a regular basis. We cannot offer a magic solution to avoiding care fees, and we are frustrated by organisations that do. Such a thing simply does not exist. In fact, anyone that does try to avoid care fees by getting rid of assets, which would include altering the ownership of their home, may be deemed to have deliberately deprived themselves of capital and/or income and may end up owing the local authority money for their care.
There are additional consequences of asset transfers. Once an asset has been transferred out of your name, you no longer have control over it. If the new owner marries, divorces or uses the property as security, your position may be affected.
If you have any concerns about protecting your assets and would like sensible advice about what practical, legal steps you can take to organise your affairs please contact our Private Client team on 01733 887665.