Has anyone severed joint tenancy on their property...

[Fordian]

I see this service is often offered alongside Will writing; so I assume it is the process of separating out your property into two halves for estate planning purposes?

Our financial advisor has advised us to do this, and it makes sense.

Have you?

Twenty-odd years ago when I worked in probate and private client for a law firm we did this for clients in order to avoid Inheritance Tax. It probably doesn't make much sense for married couples anymore because the government brought in the transferable nil-rate band and family home allowances. It might be more relevant for unmarried couples, but it is a while since I looked at it in detail as a job move took my career in a different direction.

The advice we were given related to, basically, how much older we live to, and dementia!

Too many situations where dad dies, mum gets dementia and is preyed upon by someone who marries them, then when mum dies, inherits the lot, disinheriting the DC.

Going tenants in common only allows them to grab half, not all of it.

I work with older people and pensioners and just about all of them have done this.
Most of them it's to do with potential care costs, but also in case of surviving spouses remarrying and their own children losing out.

One of my parents had dementia, I dealt with various different social workers who were trying to figure out their care needs and finances. At every meeting I would be asked if my parent owned their own home, and the answer was always that they owned half of it, being a tenant in common.
My parent died without going into care, so their 50% of the property wasn't touched. If my surviving parent needs care in the future then it will only be their 50% that can be looked at.

We did it recently when we re did our wills. It was very easy. We basically signed a form and the solicitor sent it off to to somewhere and we were written to a few weeks later to confirm it had taken place.

We did it so in our wills each of our half we go into trust to avoid the re marriage disinheritance issues discussed above

I thought (maybe wrongly) that if the property was jointly owned rather than tenants in common they couldn't touch any of it for care Home fees? Is that not correct?

If the other partner was still there

Well yes because otherwise they'd be turfing thousands of elderly people out of their own homes just because their partner needed care.
It's not uncommon these days to have an adult child move back in, either to provide low-level care or because their own finances due to divorce or whatever mean they have little other choice. So that can complicate matters re a disregard.

Disclaimer: I'm not an expert so could be wrong but this is how it was explained to me

A+B are a married couple, joint tenants
A dies and so B now owns 100% of the property
B needs care
100% of the property (minus whatever the current disregard is, £14k in England?) taken for care home fees

Or, B remarries after A's death
Doesn't get round to making a will or makes a will but leaves everything to new spouse
B dies
B's new spouse inherits the property.
A+Bs children get nowt, depending on if B made a will or not

C+D are a married couple, tenants in common
C dies, leaves their 50% to their children
D needs care
50% of the property taken for care home fees (minus the £14k)

Or D remarries after C's death
D dies
Leaves their 50% to new spouse
C+D's children get (C's) 50%

Following as I need to get my will done. I know someone who husband died. She remarried and also died young with preteens from.the first marriage. The kids got nothing. New husband sold the house at auction with all the family belongings still in situation. All of the belongings went in a house clearance. Horrible

1 in 6 people over 80 has dementia, according to the NHS. People need care either because of dementia, other ill-health or general frailty. The risk that a particular person may need long-term care is quite small - about 1 in 8 or 10 as best I can find out. Of course, someone with a pre-existing health condition or disability may have a higher risk than that. When I was doing this work I had a client who was a woman in her 90s, still mentally sound, who was becoming too frail to live on her own and was contemplating moving into a care home.

The figures may have changed, but then the average time between going into care and dying was about 2 years. Most people who need care don't do so before their late 80s or early 90s. 2 years fees in a good care home will cost around £100k, compared to a UK average house price of £268,000.

I still believe in the advice I gave my clients, which is that the risk that all your savings will go in care home fees is quite small, and you need to balance that risk against the cost and possible inconvenience of splitting marital assets. For example, if the surviving spouse only owns half the house and the other half is held in trust for the children, it adds an extra complexity should the survivor wish to move house.

Second marriages where there are children from the first, whether caused by death or divorce, are the exception as then you may need to split the assets so that all the property doesn't end up in the hands of the children of one spouse while those of the other get nothing. These do need careful planning.

Oh and I have seen a local authority care home which was so awful I wouldn't want to put a dog in it (and I'm a cat person, not a dog person).