Avoiding Care fees and why you might not want to.

It’s getting festive out there! The trees are popping up, lights beginning to twinkle and money flying out of people’s hands at an alarming rate. For a lot of people it’s not really the time to be thinking about Wills. Possibly it’s also the last subject people want to be reading about over a nice glass of mulled wine.

Not everyone is fortunate enough to be able to put things off though. A good few of my visits this month have been to care homes, to help people struggling and needing a little extra help to live their day to day life.

These visits have set me thinking about care and how most of us put off actually giving any thought to our future care whatsoever until those decisions are taken out of our hands. If we are fortunate, they pass into the hands of those who care about us. If we are less fortunate those decisions could be made by the local Council and the court of protection.

This blog won’t discuss the values of powers of attorney although they really are an essential tool which everyone should have, meriting a page of their own. What I really want to talk about is asset protection trusts and avoidance of care home fees. I probably have a slightly different take on it to some people but it is affected directly by experience.

In a magazine I advertise in there is another Will Writer who provides some content for the editors. This month’s offering made me feel more than a little concerned. The gist of the story is that it is a nice easy job to use trusts to protect your home from care fees. The article is backed up with a ten year old quote from a third party, explaining the law at that time. Like everything else in our society (perhaps more so), the law has very definitely changed during that time.

The value of trusts in some ways has been eroded although they still have many values and uses. The issue here is that the trusts are being actively promoted as a way to avoid care fees without full consideration of the situation. It preys on people’s fears and is probably a relatively easy sell for that reason.

One major problem is the law regarding deprivation of assets. People often think that the council can only look back seven years when considering disposals of assets. Far from it, they can go back indefinitely. You could well be landing your family right in the middle of an expensive and time consuming legal battle, ultimately rendering the trust useless.

Add to this that trusts aren’t for everyone as they require an element of ongoing administration and you can see that the situation requires careful thought. There are some striaghtforward changes which couples can make, which currently protect against half of aproperty being used for care fees. These can be made cheaply and easily, so if the law changes you won’t lose out too much.

The other issue which I don’t see anyone talking about is how much you actually want to avoid care fees in reality! If asked whether you would prefer your money to go to your children or the local council I know what the answer would be. If I rephrase that to whether you want freedom to choose the best care possible or whether you want to leave that choice to the council, you may answer differently.

I have never seen it mentioned butit has to be an important factor. I went into three care homes this month. One of them stood out as the kind of place I would like to be. The staff were wonderful, the environment just right, the effort to make Christmas special was outstanding and there was even a lovely, friendly dog.

The lady I was visiting had been there for a while but was moving and sad to be doing so. I only hope the place she finds is as special. It got me thinking that as much as I want my children to inherit I would also like to stay in the best home possible. There needs to be an overhaul of the whole system but in the meantime be careful what you sign up to and make sure you understand fully why you are setting up a trust if you decide to.