Financial Advice-how does it work?

[funkymerc]

Hi there,

So starting to think about mums care needs which I'm hoping won't happen for a good while yet however I know this might not be the case so I want to be armoured with as much knowledge as possible. Knowledge that I'm sure a lot of you have acquired through your own journey and could therefore help me to understand.

Basically the long and short of it is, if I need to put mum into a care home how is my mums financial status judged? I mean, would she be required to sell her property and the amount that it sells for all/some goes towards her care? She doesn't have any savings other than owning her home which costs in the access of £300,000 and gets a monthly widows state pension each month. I'm not sure if I should be asking this question but is there anyway to protect, if sold, the value of mums home. Seems so unfair for her to lose this after working all her life for it. Really don't have a clue how it is all worked out here and thought I would ask for help here first.

Input will be greatly appreciated.
Thanks

 

[loveahug]

Hi there

Sorry, this is going to be a bit blunt, but your mother's assets are for your mother's benefit. If she goes into care she will be deemed to be self funding, any assets over £23,500 means you have to self fund. If her income is insufficient, the funds released from her assets must be used for her benefit. Nothing can or should be done to try and shield the assets, it will be deemed 'deprivation of assets' by the LA. Unless you live in Scotland that is the case. Of course you can purchase a lifetime care policy which guarantees funds for her care until your mother passes away, these are expensive and are based on a life expectancy judgement. There is nothing 'fair' about this system, but that is how it is at present.

Best wishes

 

[nicoise]

Dear Funkymerc,

Have you sorted out lasting power of attorney for your mum yet? That would be a good starting point for assisting her with her finances, and making longer term plans. I am writing that assuming she has capacity to grant you or your siblings LPA.

Loveahug has summed up the harsh reality of having assets that can pay for care costs. Rather than viewing your mum as losing her home by having to sell it, take the view that having funds gives her/you choices as to where she might live if residential care is needed - this is that rainy day that she worked hard to save towards.

Your mum might move to rented accommodation, or residential care, and her house could be rented out to give her an income to pay care fees rather than selling it.

And that is something else to bear in mind - not everyone needs residential care. Care can be given in the home, whether by carers or family members, which can be less costly than residential care.

 

[nitram]

The rules about charging for care are defined in

http://www.dhsspsni.gov.uk/charging-for-residential-accommodation-guide-2013.pdf

a good place to start to understand them is

http://www.parliament.uk/briefing-papers/sn01911.pdf‎

Has your mother had a diagnosis of dementia or any other illness that could well lead to residential care?

If not you could consider changing her property from sole ownership to tenants in common with a joint owner. This situation is covered in the second link but basically the LA would be arguing about the value of half a house with the owner of the other half unwilling to sell. The change of ownership must not be done to prevent the LA having access to the full value of the property.

 

[funkymerc]

Hi there

Sorry, this is going to be a bit blunt, but your mother's assets are for your mother's benefit. If she goes into care she will be deemed to be self funding, any assets over £23,500 means you have to self fund. If her income is insufficient, the funds released from her assets must be used for her benefit. Nothing can or should be done to try and shield the assets, it will be deemed 'deprivation of assets' by the LA. Unless you live in Scotland that is the case. Of course you can purchase a lifetime care policy which guarantees funds for her care until your mother passes away, these are expensive and are based on a life expectancy judgement. There is nothing 'fair' about this system, but that is how it is at present.

Best wishes

Hi loveahug,

Thanks your reply. Now I know where we stand. Of course I wasn't planning to do anything illegal and as that would be unethical and that's not me - I simply wanted to know what my legal options where. Thanks for taking the time to reply.

 

[funkymerc]

Dear Funkymerc,

Have you sorted out lasting power of attorney for your mum yet? That would be a good starting point for assisting her with her finances, and making longer term plans. I am writing that assuming she has capacity to grant you or your siblings LPA.

Loveahug has summed up the harsh reality of having assets that can pay for care costs. Rather than viewing your mum as losing her home by having to sell it, take the view that having funds gives her/you choices as to where she might live if residential care is needed - this is that rainy day that she worked hard to save towards.

Your mum might move to rented accommodation, or residential care, and her house could be rented out to give her an income to pay care fees rather than selling it.

And that is something else to bear in mind - not everyone needs residential care. Care can be given in the home, whether by carers or family members, which can be less costly than residential care.

Hello nicoise,

Thanks for your reply. Yes we have LPA sorted. Renting mums apartment out was actually an option that crossed my mind but wasn't sure if it would work like that, why I don't know but thought we would have to sell to fund for her care. Thanks for your input.

 

[nicoise]

Hope I helped a little. There's so much to get your head around, and sadly you will become an 'armchair expert' in matters you never wanted to know about.

Renting mums apartment out was actually an option that crossed my mind but wasn't sure if it would work like that, why I don't know but thought we would have to sell to fund for her care.

I suppose that a downside of renting is whether the income from that meets the costs of care, which of course is pretty steep. There are also the logistics of managing that as a landlord, which brings its own stresses.

There is also a rather miserable statistic that estimates that a person moving into residential care will on average live there for two and a half years, so you may not need to find enormous sums. My mum managed just under two weeks; but others do live much longer than the statistical timeframe. How long is a piece of string?

But you are wise to look into all the options and have your eyes open about what might need doing. Good luck

 

[loveahug]

I hope I did not give the impression that I thought you might want to do something illegal or unethical, your post came across as very concerned for your mum and her future, I just wanted to spell it out in straightforward terms. As others have said, it is cheaper and far preferable that your mum stays in her own home as long as possible and that can be achieved in very many different ways. If her assets (other than her home) are at or below the mimimum (approx £14,000) and her income is insufficient to meet the costs, then the Local Authority should fund her 'at home' care. Be aware the LA will quite happily ignore her entitlements if she and her family are happy to care for or fund her! AND it is essential that she authorises POA for Health and Welfare as well as Financial and Property matters.

Best wishes

 

[funkymerc]

I hope I did not give the impression that I thought you might want to do something illegal or unethical, your post came across as very concerned for your mum and her future, I just wanted to spell it out in straightforward terms. As others have said, it is cheaper and far preferable that your mum stays in her own home as long as possible and that can be achieved in very many different ways. If her assets (other than her home) are at or below the mimimum (approx £14,000) and her income is insufficient to meet the costs, then the Local Authority should fund her 'at home' care. Be aware the LA will quite happily ignore her entitlements if she and her family are happy to care for or fund her! AND it is essential that she authorises POA for Health and Welfare as well as Financial and Property matters.

Best wishes

Hi loveahug,

No offence taken. In such situations it's best just to get straight to the point. You have been very helpful indeed. So to get home care is this something you really need to argue for? When you say 'home care' is that a carer dropping in every day for a few hours or something more permanent? Thanks again.

 

[jenniferpa]

When it comes to funding home care, you might want to download and read this https://www.gov.uk/government/uploa...rer_Charging_Guidance_final_2013-06-20_rc.pdf

This is the Update to Fairer Charging Policies guidance for non-residential social services

Also https://www.gov.uk/government/publi...g-arrangements-for-adult-social-care-services which is the page for the above has the most recent copy of CRAG which covers charging for Residential Care.

The other option that I don't think has been mentioned, is that in the event a home is eventually needed you may have the option to apply for deferred payments (where the cost of the care home accrues against the property). The thing is, though, currently this is effectively interest free loan but this may not remain the situation in the future.

P.S. I'm moving this thread to the Legal and Financial advice forum as that is the most appropriate place for it.

 

[loveahug]

Hi again funky

If you want LA funding the social Services will have to visit and put together a statement of needs. They are supposed to abide by the rule that no adult is 'required' to take care of another adult, however if you volunteer to do so, they will accept that as a sine qua non. The care recipient or their POA can opt for the cash to arrange their own care or the care provided by the LA. That is what is in the news so much at the moment, most LA's only provide care in 15 minute slots, the frequency in the day is then decided during assessment. Because my mother's savings at the moment (but not for much longer!) mean she is self funding, her care visits last for half an hour, and I can't imagine how they would manage her needs in a 15 minute slot. You really also need to contact Age UK, Crossroads and the local Alzheimer's society to see what they can offer by way of volunteer visiting as social inclusion is sadly lacking for dementia sufferers. There are also day centre and activity clubs in some areas. Also singing for the memory groups may exist in your area.

I'm sure other members will point out the gaps in my information, I'm still in the office so my thoughts are on a different 'train' at present.

Regards