Long-Term care issues
Protecting Your Home: Understanding Long-Term Care Costs in the UK.
In the UK, the biggest threat to your estate may be losing what is often your largest asset, the family home.
Some facts.
While specific statistics can vary, reports suggest that many individuals are forced to sell their homes to cover care costs.
According to the 2021 report by the Association of British Insurers (ABI), it was estimated that around 40% of individuals may need to sell their homes to pay for long-term care. The costs can vary widely depending on the type and location of care. Still, figures indicate that residential care can cost upwards of £1,000 per week, nursing care can be considerably more expensive depending on the level of care required. We have clients paying over £100,000 a year.
The total amount of money tied up in properties sold for care costs can be substantial in terms of financial impact. It’s estimated that around £1.2 billion a year in property wealth is used to fund care costs, a figure that represents potential inheritance lost.
In the UK, the issue of selling homes to pay for long-term care has become increasingly significant. Protect it or lose it. You will know of someone whose home has been sold to pay for their long term care.
As such, In the United Kingdom, many individuals face the distressing possibility of selling their homes to finance long-term care needs. This
situation often emerges due to policies that require those with assets above a certain threshold to contribute to their care costs. At the same time, individuals with fewer resources receive assistance from the state. This page explores the complexities surrounding this issue and offers potential solutions to help protect your family home.
The Current Landscape
Under current UK regulations, individuals with assets over £23,250 may be required to fund their residential care, nursing care. This often forces families to sell the family home. Contrarily, those with fewer assets receive state aid financed by taxpayers, creating a perceived inequity between those who have saved and those who have not.
Case Studies
Case Study 1:
Mr. and Mrs. Smith worked all their lives, investing carefully in their home. When Mrs Smith required long-term care, the couple faced the daunting prospect of selling their cherished family home to cover the cost.
Case Study 2:
Mr Jones, who had limited savings and rented, received full state support when he needed similar care, highlighting the disparity in financial burden.
Possible Solutions
1. Utilising Wills Effectively
Inheritance Planning: Drafting a comprehensive will that includes specific provisions for your property can help protect it. Consider leaving your share of the home in Trust to your children or other beneficiaries, providing a right to reside for the spouse rather than outright ownership.
2. Setting up a Lifetime Trust
Protective Trusts: This involves placing assets into a trust, which can prevent them from being counted as part of your estate when local authorities assess care costs. Trusts must be set up well in advance, as recent changes in laws scrutinise such measures to prevent deliberate deprivation of assets.
Conclusion
Liberty Legal Services are experts in advising what is legally acceptable to preserve the family home; while navigating the financial challenges of long- term care in the UK can be daunting, careful planning can protect your assets. Utilising wills, trusts, and other financial products can shield your home from forced sales and ensure it remains a lasting legacy.
Disclaimer: The information provided on this page is for informational purposes only and does not constitute legal advice. Please consult with a
qualified legal professional for advice regarding your situation.
Our services
Liberty Legal Services can draft your Financial & Health and Welfare LPAs, register them with the Office of the Public Guardian, and store them for you—it’s not expensive.
Your LPA is like an insurance policy you hope you will never use. Without one, by law you must go through the Court of Protection, a process that can take many months and cost you many £000’s. Drafting and registering your LPA in advance means it can be used immediately if required.
We also act as professional Attorneys, a service that many clients have taken advantage of. Having a professional Attorney can be a good, sensible alternative when no suitable family members are available.
English Family Trust
As an industry expert, trust the English Family Trust to protect your assets and provide financial security for your loved ones. With proven success and a professional tone, this trust offers peace of mind and ensures your assets are passed down according to your wishes.
To find out if your home can be protected from being sold to pay for your care fees and how you can avoid probate fees – call us on 01977 780438 or visit www.englishfamilytrust.
