You have worked hard all your life, saved your money, and hope to have a bit to pass on to your family - but then it is eaten up by paying for Residential Care Fees! For a typical couple, figures suggest there is nearly a 1-in-2 chance that either or both of you might lose money in this way. What can be done about this?
The solution is to ensure that the home is not personally owned on entry into care. The local authority’s financial assessment can then legitimately and properly be completed on the basis that the home is not a capital resource of the resident.
The solution involves putting the home into a trust, so that the trust is the owner of the property.
The trust described above is equally applicable to married couples as to single owners. In fact, married couples entering
into the strategy will have the additional advantage that they do so at a time when if one of them went into care, the
home would in any event be disregarded due to the other spouse still living in it.
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If planning is done well in advance then the various remedies and anti avoidance provisions available to the local authority can be avoided. The question is simply whether the measures taken ensure that assets are not brought within the financial assessment on entry into care.
Until the first death the family home carries a “disregard” status, therefore any planning undertaken while both spouses are alive is even more likely to be secure from local authority attack. If a husband and wife undertake long term planning while both are alive, their planning should usually be successful.