Money concerns if spouse goes into nursing care

[ifonly4]

DA feels they're nearly at the stage where my DU needs residential/nursing care.

She hasn't worked during her married life (DU has been more than happy with this). DU put some money into her name years ago for tax purposes. There is also money in joint account. Income is DU's work pension and old age pension and they have a joint property.

Auntie is worried all her money will be taken and she won't be able to afford to live.

Am I right that anything in her name, she can keep and the joint account will be seen as 50/50? Auntie can remain in property but a charge can be put on it, so care costs can be recovered on the death of both of them or selling up if Auntie goes into care?

Re: state pension, she hasn't built up any credits, so any idea what she's entitled to on her own? Also, would she have any claim on DU's pension (given that she's always been solely financially dependent on him for 45+ years)?

Not so important, but DU is very much mentally capable, so could he give a gift of £3000 to his son at this stage, knowing care home costs around around the corner.

She needs to as SS for an assessment to be done. If they agree he needs specialty nursing care they can put a case forward for a package to be funded allowing her to remain in the home. My friend managed to get her DMs place funded ( she had dementia and Parkinson's) and her DF stayed in the marital home.

Property is disregarded if a spouse lives in it.

If you gift money after you anticipate you will have care and support needs it is deemed deprivation of assets so the gift will be treated as an asset still.

He needs a Local Authority Care Act assessment then a financial assessment.

Propert is disregarded while DA lives there. She will be entitled to half his work pension. If she can't get a state pension she maybe entitled to pension credit.
DU can't gift money it will be deprivation of assets.
Any capital in her name is hers, joint accounts will be split 50/50.

Age uk or citizens advice will be able to offer guidance.

DA and DU is confusing
Your mean Aunt and Uncle ?

Firstly which country do they live in? Even Scotland Ireland and England within the U.K. have different legislation covering financial arrangements for care home funding.

So Uncle needs a care home?
His wife doesn't. They own one property together and both have some savings. He has most of the income ...

English legislation :-

Financially he would be assessed as self funding if he has more than £23,250 in savings and other assets not including his main home. This is because his wife lives with him so the property is disregarded whilst she lives there.

When he moves into care home, he would be better to split their joint account - put both their 50% shares into their separate single name accounts so you can see what share is his. His will go down fastest due to care home fees . So if that's his only asset outside their shared home, for eg if he had £40k in savings, it wouldn't take long for his capital to deplete to £23,250 at which point he can ask his local authority for assessment including financial assessment on whether they would find his care home placement

If he gifted his wife an amount of money many years ago , and he has no recourse to it, Ie it is fully hers. Then those savings are hers and not included in his savings/ financial assessment

No, Uncle cannot give away £3k to his son at this point now. That would be seen as deprivation of assets, likely he would be treated as if he still had it.

Regarding spouse's private pension, for the purposes of financial assessment when LA social care are funding someone's placement the spouse can be entitled to be allowed 50% of private pension (if the person consents).

For some husbands/ wives at home they don't want to have it as it then means they cannot make a claim for pension credit and CTB based on low income (for large houses CTB alone could be worth £220/month and when you add on what pension credit you'd get and other low income benefits, sometimes the person at home is better off not taking it, unless their own savings preclude that- ie above pension credit threshold )

If uncle has less than £23,250 in savings or assets not tied up in his home , you really need to ask LA (local authority) social care dos a needs assessment before anything else. The social worker will explain it all to you. Most social care teams have a long wait list , post covid, so the sooner you refer him the better . They will advise if he's nursing or residential or meets criteria for a placement

If he is to be self funding and your uncle feels that's right for him , he can decide not to await assessment and to place himself in a care home privately as he'd be private client anyway. He's best off considering if it's near to the local social care rate and making sure he gets right type of home.

Thanks for your replies, lots of think about.

I'm sure my Uncle has more than £23,250 as they had approx £90,000 last November, due to moving to a smaller home.

I know my Uncle had some sort of assessment about ten weeks ago and a care package was put together (which I think he/they are paying for). He's fallen out of bed a couple of times this week and care team have told Auntie to phone for ambulance next time, as she's tiny, frail and disabled (doesn't have the use of one arm). He's also had a couple of accidents in bed and it's too much for them to deal with between them. He's now talking about not eating and drinking to avoid any more accidents.

They live in England. Despite Auntie's arm, she has always managed and can still do so. New home is in excellent condition, on ground floor so easy for Auntie to stay in.

I understand your concerns. When my mil went into a home and we looked through their finances as part of that, it really brought home to me the financial consequences of staying at home with children, rather than continuing to work. Virtually all their income was from FIL pension: at least 90% of it. In a way it was lucky that it was that way round: Fil has been able to stay in their jointly owned home and continue to receive his pension, while she is pretty much fully-funded by the state for care.

they did do what a pp recommends - split their joint account into two individual accounts and split the savings 50:50. It made things simpler.

They should probably put their house as tenants in common rather than joint tenants. If uncle dies, his half of the house can go to his son, you, whoever. Joint tenants it will go to her and be eaten up by care home fees-this isn’t depreciation of assets.

@Chocchops72
But if FiL had needed the placement and MIL was staying home, MIL would have been entitled either to half his private pension of LA were funding his placement Or if she had savings less than £10-16k she might have chosen to refuse it and claim pension credit etc which would have topped up her minimal state pension and given her low income dWP benefit entitlements such as CT exemption

For some people that's far more than 1/2 their s

As previously advised property is disregarded when a spouse remains in it. Gifting 50k to avoid paying care is deprivation. Making normal gifts that you might otherwise have made is not deprivation. Eg if DU traditionally gave DA a present for birthday, Xmas and anniversary it would be reasonable to continue. If he has children, grandchildren,nieces and nephews whom he made gifts to on birthdays etc it would be reasonable to continue. If those gifts were traditionally £50 and he starts making them £500 to everyone when knowing he needs care that could be viewed as deprivation. A £10 DD to Battersea or other charity can be left running. Check DA's benefit entitlement (pension credit etc) as they will be treated as single people when he goes into care.

Putting houses jointly owned between spouses into tenants in common only has benefits for inheritance purposes after they die. Usually it's done to leave someone's share to next generation.

It doesn't affect the property being disregarded by the LA, when a spouse or partner is still living there.

@euff is right

It's called Deprivation of assets

I think OP had asked if her uncle could do a £3k gift to his son -not £50k - but social care wouldn't ignore even £3k given away

Nor too would DWP benefits agency or borough council (for HB or CTB) ignore any recent large gifts of money to others if the same person who's made the gifts then went onto apply for any means tested benefits

By the time someone has care package and / or is considering going into a care home, please don't encourage them to give any large sums away .

As Euur says, you can of course give reasonable birthday and Xmas presents etc

People sometimes mix up the inheritance tax rules (that HMRC may exclude a £3k gift for wedding to a close relative if within 7 years of death) with deprivation of asset rules for when people are asking for LA and DWP financial help

Once in a care home if they are LA funded , the person would be expected to adjust their gifting/ presents to what is reasonable to their means.

@ifonly4
Do you feel you've had some good advice /information about how funding care homes works?

Age concern do good general advice too

https://www.ageuk.org.uk/globalassets/age-uk/documents/factsheets/fs29findinggchoosinganddfundingaacarehomeefcs.pdf

www.ageuk.org.uk/information-advice/care/paying-for-care/financial-assessment/

And it costs a few hundred

Thank you for your replies. They're really helpful and gives me something to refer to so I can support if necessary.

DIL has had someone out this morning to assess. Auntie a bit muddly (stress I think) so couldn't work out who. My Uncle can't stand due to low blood pressure, so will have to remain in bed. His current care package (two visits a day is funded) and will need to be increased, so I'm hopeful this can be funded as well and he can stay at home.

I talked to Auntie about money. She's told me she's had a lump sum in her name for a good few years, so that's positive. Have made it clear I'll try and help if I can (if either become mentally incapable their DS and myself will be Attorneys so they trust me).

DIL isn't always around as she has health problems and is sometimes away for treatment or testing with family, leaving my cousin with a lot on his plate.