Care fee planning
Many people who are faced with a diagnosis of dementia become concerned about care fees, particularly with the rising cost of care.
Whilst it is hoped that care fees will be addressed substantively following the general election 2017, there are some steps you can take with the use of effective will planning, to ensure one half of your estate is ring-fenced from being absorbed in care fees.
Life Interest Will Trusts
Trusts within your will take effect on your death, and are achieved through clauses in your will. Life Interest Trusts are particularly useful in a number of scenarios, especially when you are concerned about future care fees.
The Trust takes effect when the first spouse passes away and places their assets within a trust environment. This could include half of any jointly owned property. Doing this, allows the surviving spouse to continue to live in the property and obtain an income from the invested trust assets. This can include:
- interest from bank accounts
- dividend payments
- rental income.
It also protects half of your joint estate from any redirection by the surviving spouse, through an unconscious decision such as care fees.
Life Interest Trusts are flexible, offer a protective environment and whilst the administration of the trust is slightly more complicated than leaving everything outright to the surviving spouse on first death, this needs to be weighed against the asset protection the trust structure offers.
How can we help
If you have recently been diagnosed with dementia and are concerned about care fees and the implications this may have on your family, it may be the time to consider reviewing your will and discussing your options with a member of our Private Client team who would be pleased to assist you.
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