Joint current accounts

[CollegeGirl]

What happens to joint current accounts if one of the spouses has to go into full-time care and is not self funding?

Is half of the total amount of money which is paid into the account monthly taken out by the LA? Or only that part of the money which is paid into the account in the of name the person going into care, ie pension and other income?

Many thanks for any help.

 

[jenniferpa]

The only money that would be paid for care in a situation such as that is the person in care's pensions and allowances (although those mostly stop), plus any tariff income based on savings. It's a good idea to separate jointly held accounts, not least because you want to make sure that only your mother is paying for her care, and not depleting any savings your father might have. In fact, it's probably better to do that separation of finances sooner rather than later.

I can't remember - does your father have a power of attorney for your mother?

 

[Lowlander]

What happens to joint current accounts if one of the spouses has to go into full-time care and is not self funding?

Is half of the total amount of money which is paid into the account monthly taken out by the LA? Or only that part of the money which is paid into the account in the of name the person going into care, ie pension and other income?

Many thanks for any help.

The financial assessment by the LA will want to know the income of the assessed person. They will want evidence of pension payments,ie occupational, state, and private annuities etc.
(They will want to see evidence of the amount of savings, joint or otherwise.)
So, perhaps it doesn't matter how the income is held, apart from assessing the savings element of it, which in a joint account would be half.
I'm not sure I am addressing your question.
The LA have no right to ask about a spouse income.
But they do have the right to ask about savings held jointly in any account.

 

[nitram]

"The only money that would be paid for care in a situation such as that is the person in care's pensions and allowances (although those mostly stop), plus any tariff income based on savings."

To clarify slightly, it's all the DWP pension but only half of any occupational (private) pension.

 

[jenniferpa]

Yes, quite right nitram.

 

[Lowlander]

"The only money that would be paid for care in a situation such as that is the person in care's pensions and allowances (although those mostly stop), plus any tariff income based on savings."

To clarify slightly, it's all the DWP pension but only half of any occupational (private) pension.

Nitram, you always post so succinctly.

 

[CollegeGirl]

Thank you all for your responses.

So, do I understand correctly - in the event of my mam going into full-time care, only the income from HER pension will be used by the LA? And my dad's income from his pensions, even though going into the same joint current account, will not be touched?

I think she only has a small state pension, no private pension, and Dad does not have LPA for her, by the way.

 

[jenniferpa]

If that's the case CG I think it might be worthwhile for your dad to apply to be her appointee and for him to set up another account where his pensions (and your mothers) will be paid. This is because that if the bank discovers that she has lost capacity, they should freeze the joint account. Have a look at this thread that lin posted today http://forum.alzheimers.org.uk/showthread.php?63788-warning-Joint-account-and-mental-capacity

I just think it would be easier to do this now, rather than getting caught in the banking regulations at an even more stressful time.

 

[CollegeGirl]

Sorry, Jennifer, I should have said that actually I am her appointee for her pension and her attendance allowance, and am also a third party signatory on their account. Does that make a difference?

 

[nitram]

"If that's the case CG I think it might be worthwhile for your dad to apply to be her appointee and for him to set up another account where his pensions (and your mothers) will be paid."

Not with the same bank or even an associated one, eg Lloyds & Halifax, Yorkshire & Clydesdale. If they see the appointee account they will become suspicious.

I don't think putting dad's pension in the appointee account is a good idea, it would be better in a second new account or if mam can still sign make the existing account sole in dad's name.

Any capital in the joint account should be split at an appropriate time ie when funds are low due to standard incomings and outgoings.

 

[jenniferpa]

Sorry, Jennifer, I should have said that actually I am her appointee for her pension and her attendance allowance, and am also a third party signatory on their account. Does that make a difference?

Even if you have third party access to their account that won't make a difference if the bank freezes the account. If you are the appointee then really your mother's pension etc should be being paid into an account that you control, rather than this joint account. I know a lot of people just let the money be paid into the normal current account in the name of the person for whom they are appointee (in fact, I was one of them) but it's potentially fraught.

Your father really needs to get a sole account in his name so that he can access his own funds in the event that the bank freezes the account. I realise this might be a step too far for him, but it really would be better to do it now, rather than in a panic later.

 

[nitram]

Are you appointee for your mam on the joint account?

 

[CollegeGirl]

Are you appointee for your mam on the joint account?

Yes.

 

[nitram]

Do the bank know ie have you given them a BF57?

https://www.gov.uk/government/uploa...26777/Appendix-02_An_example_of_form_BF57.pdf

 

[CollegeGirl]

Do the bank know ie have you given them a BF57?

https://www.gov.uk/government/uploa...26777/Appendix-02_An_example_of_form_BF57.pdf

Well, I do have a copy of that form, filled in by the Visiting Officer who interviewed me, and then dad and I had an appointment at the bank to sort it all out. Although I can't remember specifically giving them the form to copy, I would imagine that I did do that, yes. It was almost two years ago now.

 

[Saffie]

And my dad's income from his pensions, even though going into the same joint current account, will not be touched?

If it is a joint account it will be divided into 2 regardless of in whose name the money was paid into the account. This is what happened to me once the LA started to part fund my husband's nursing home fees and they split the joint current account.

 

[CollegeGirl]

If it is a joint account it will be divided into 2 regardless of in whose name the money was paid into the account. This is what happened to me once the LA started to part fund my husband's nursing home fees and they split the joint current account.

This is what I fear happening, Saffie. So part of your own income is used to pay the nursing home, leaving you with a reduced income?

 

[nitram]

OK, no need to contact bank about that.

If your dad opened a sole account in his name and told DWP to pay his pension into it you would be left with a joint account with you as appointee for your mam with only mam's finances in it. This would separate their finances.

Not ideal but if your mam can't sign to make the account sole in your dad's name it's a good compromise

When dad has his account set up you could contact DWP and tell them you want to move mam's BF57 account to a different bank, if you manage to do this then using your third party mandate you could empty the joint account except for £1 and then leave it at that. They each have their own account.

 

[nitram]

As you have the BF57 you can just open a new account elsewhere and then tell the DWP to pay into it.

Then get dad his account get DWP to pay his pension into it and drain the joint account except for £1

 

[Saffie]

No, no. The money in our joint account was all my husband's income - I have only the married woman's portion of his pension and none in my own right. However, as it was a joint account, once the LA came partly on board, it had to be split.So I had half what was in it but have not used the account for myself since. All the bills etc were transferred into an account in my name in well before this.

It is left as a joint account on the advice of the bank manager simply for expediency's sake although I have Deputyship. It just means that it is easier for me to access the bank account on my husband's behalf and to transfer half his teacher's pension to my own account each month and to also transfer his allowance as I prefer to keep that separate too. As a Deputy I have to send a report every year and this makes things more clear -cut for me to manage.

All the bank account is now used for is to receive the state and teacher's pension and anything else that comes my husband's way (very occasionally!) and to pay out a life insurance policy for him, half the Teacher's pension, his allowance and the nursing home fees.