First, the good news: We’re all living longer. Hooray!
Thanks to better diets, less smoking, more exercise and improved healthcare, more of us are living well into our eighties.
And some are going well beyond that.
The slightly less good news is that unless you remain in excellent health, care costs could wipe out your inheritance.
Care in this situation doesn’t just mean moving into a care home.
With support from care providers, you could continue living in your home, but of course, there will be a cost for that service.
The cost of care in the UK varies, with typical rates around £20-£30 per hour for home care, £800-£1,600+ per week for live-in care, and £950-£1,600+ per week for residential or nursing home care.
The final amounts required depend on factors such as your location, the type of care needed, and your financial circumstances.
If you’re eligible, local authority funding may reduce the amount you have to pay.
As you can see, these costs, which are not part of your life now, could eat into the money you plan to pass on as an inheritance to your children.
There is a way to guard against the risk.
Home Protection Trusts are a legal arrangement where you transfer ownership of your home to a trust, with trustees (often family members) managing it on your behalf, while you retain the right to live there for life.
This structure protects your property from care fees, divorce, bankruptcy, and probate, ultimately ensuring your beneficiaries can inherit it.
Setting up a trust, while offering substantial benefits, does involve a loss of direct control over the property. It’s a complex process that requires professional legal advice to ensure it meets your specific needs.
That’s where I can help.
I specialise in helping people plan for the safe transfer of assets to their loved ones in the most tax-efficient ways.
To discuss this and other aspects of inheritance, send an email to [email protected] or call (44) 07973 175 882.
Graham PS. Read why it’s essential to update your will