What to do with proceeds of house sale (earmarked for nursing home)?

[redskydarknight]

I wasn't sure whether to post this here or in Money Matters, but I figured there were probably people on here that have gone through this same dilemma.

Sadly MIL is now unable to live independently and is in a nursing home. Her house is being sold to pay for care (she has no other notable assets). The question is - where do we put the lump sum that this will generate? DH was just going to put it in her savings account but I pointed out that only £85000 would be protected. MIL doesn't have any other accounts. DH has PoA and can obviously open more in her name and spread the money about, but he has had previous bad experiences regarding the challenge of trying to do things with a PoA and would rather avoid if possible.

Is this just what everyone does, or is there another solution we are missing?

It's protected for 6 months up to £1 million as a temporary high balance because of house sale so you have a bit of time to consider it.

Premium Bonds are not a particularly good option. As PoA you need to be sure you are acting in the person's best interest. You could argue that their best interest is security of return, or maximising return - PBs do neither. Although the capital is fully protected.

NS&I savings bonds or savings acccount are better - known interest rates and protected up to more than you probably need.

An immediate needs care annuity is worth looking at. Guaranteed to pay for as long as you need, so a totally safe option although not necessarily the best financial value.

If you want an ordinary bank savings account, Nationwide is one of the better at dealing with PoAs and usually has decent interest rates. It will be only the 85k protection, but as PP have pointed out that only matters if the bank/building society goes under which is pretty unlikely.

We had to do this. As PoA I have found Barclays (my mum's bank) pretty straightforward. I did need to go once with all the documents to get the basic access I needed, and I also needed to go again when I opened a savings account to put the bulk of her money in.

Shes very elderly so the decisions i make for her are based on immediate returns, nothing long term. She once got turned down from a nursing home because she didn't have enough in cash as we hadn't sold the flat then. So therefore I have always kept most of her money in the highest interest instant access savings account I can. This is both very easy and I think a defensible decision, if not perfect. Her pension is paid into her current account for day to day expenses.

Quite honestly go into a bank. Do not rely on a call centre to help you. They will mess you around and tell you often complete rubbish. I have done POA twice one of which was across a number of bank accounts.

NS&I are your best bet to invest. Mixture of Premimum Bonds and Direct Saver perhaps where you cna get the money immediately.There is a limit for protection - £1 m from memory. Lots of people do this. Or realistically is Nat West or Lloyds really go to go pop whilst it is being spent.I would take the risk on this if its easier.

I was in this position with my mother. Originally she had invested her money in a few different places and I drew down the money in tranches from the investment which held the most money. I got fed up with doing that, there was a handling fee for each withdrawal, and of course investments can go up or down.

So when she had about £150k left I moved it all to her Halifax savings account. I did mull about splitting it into two due to the £85k issue, but honestly I could not be doing with the aggravation. That was several years ago and needless to say the money quickly went on care fees, and she only has £23k left now.

I completely understand the POA aggravation factor. I had to deal with several financial institutions because that was the way things were set up initially, some were great but some were hopeless. So once I took over I kept things as simple as possible.