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Funding care home fees from the proceeds of an estate.
Betty G
Posted: 23 April 2018 12:11:38(UTC)

Joined: 31/05/2017(UTC)
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My widowed mother has dementia and is now in need of full time care. The cost of this care would be aproximately £650 per week.
She has a cash balance of 50k, a house worth 350k, and a pension income of 8k per year.
I have been investing for growth myself for over 30 years, but I’m not too sure that my type of investing would be at all suitable in this case. I could actually make a case for it, in that should we see a marked , prolonged downturn in the markets,and the funds become severely depleted, the local council would have to pick up the bill,
So, in a sense, it’s investing with little risk to my mothers welfare. However, I am also aware that any surplus capital that is left on her death, which is given at 2 to 4 years, would be a windfall to my family.
It’s a dillema, and one which I would love to read the thoughts on of others.

( my initial thoughts were to consider enhanced income funds, bonds and multi asset income)
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Tim D on 23/04/2018(UTC)
Posted: 23 April 2018 12:36:07(UTC)

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Anyone with capital over £23250 (including value of property they are not living in) will get no local authority help with funding. It would have to be some downturn for someone with 400K in capital to become eligible. If she stays at home then things would be different.
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dlp6666 on 23/04/2018(UTC)
Posted: 23 April 2018 17:45:38(UTC)

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Betty G;61094 wrote:
I have been investing for growth myself for over 30 years, but I’m not too sure that my type of investing would be at all suitable in this case. I could actually make a case for it, in that should we see a marked , prolonged downturn in the markets,and the funds become severely depleted, the local council would have to pick up the bill,

But there's not much to invest until the house is sold.
Current cash and pension won't last much than a year. And anything that the council spend will have to be repaid.
Tim D
Posted: 23 April 2018 19:13:50(UTC)

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Assuming you have a an LPA in place (if not, just ignore this!)... note that there was an interesting case back in 2013 where the judgement seems to be regarded as establishing some sort of precedent for what attorneys can reasonably do with investments... googling the phrase "Managing your own money is one thing. Managing someone else's money is an entirely different matter" will turn up various reports of it... there's a nice concise summary at ; note in particular this bit:

Most people who make an LPA are older people, whose average age is 80 years and 11 months. The type of investment that will be in their best interests will be very different than for someone less senior. Senior Judge Lush suggested a short-term investment strategy for persons of 80 years and over and/or those with a life expectancy of less than five years, and listed the types of products that investments should be limited to. This list will likely make surprising reading for many attorneys and deputies as its conservativeness is notable: investments are generally limited to cash deposits and/or gilts.

There's also:

Senior Judge Lush made clear that attorneys and deputies should abide by the provisions of s.5 of the Trustee Act 2000 which requires that proper advice from a qualified person is taken before making an investment.

(although if you do then try and work with an adviser... you may run into this: )
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Betty G on 23/04/2018(UTC), dlp6666 on 24/04/2018(UTC), Pensioner on 24/04/2018(UTC)
Tony Peterson
Posted: 23 April 2018 20:38:44(UTC)

Joined: 10/08/2009(UTC)
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Just a little thought that suggests senior judges may not always be omniscient.

As I see it (as an octogenarian with no apparent signs of dementia yet) - if you enjoy invested assets worth around £2M you could cover the costs of care from income in todays climate if, and only if, investments were in high yielding equities. With gilts or bonds or cash on deposit, you would dipping into capital.

That is why you should all be investing optimally. You will all get old one day. Barring accidents..
3 users thanked Tony Peterson for this post.
kWIKSAVE on 27/04/2018(UTC), Andrew Smith 259 on 27/04/2018(UTC), Tim D on 28/04/2018(UTC)
philip gosling
Posted: 23 April 2018 20:45:06(UTC)

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Betty -I assume your mum has had a personal care plan done for her? Plus if you check Age Uk website for NHS Funded continuing health care plan that pays for medical aspects of treatment - because people with dementia often have other medical conditions. Most NHS Trusts are trying to avoid paying but it might be well worth checking up on eligibility as each individual has different needs. Apparently you will need perseverance and dogged determination to 'force" assessors to consider the case for funding by your NHS Trust.
Other sites but this is one to check out
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dlp6666 on 24/04/2018(UTC), Helen on 24/04/2018(UTC), john brace on 27/04/2018(UTC)
Tom Woods
Posted: 24 April 2018 08:26:29(UTC)

Joined: 20/04/2018(UTC)
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For my mother (84) and her elder sister (99), both of whom have dementia and have been in care homes for 3+ years, we (the family) have purchased Immediate Care Annuities (funded by sale of their houses) to cover most of their fees.

These aren't cheap, but do guarantee an income (which can increase annually or be static) until the death of the insured, and thus provide some certainty as to future costs. They also allow my mother and her sister to remain in very nice (albeit expensive) private care homes for their last few years. And there are an awful lot of grotty ones out there, esp. local authority funded ones.
7 users thanked Tom Woods for this post.
dlp6666 on 24/04/2018(UTC), Andrew Smith 259 on 24/04/2018(UTC), Pensioner on 24/04/2018(UTC), Helen on 24/04/2018(UTC), Guest on 24/04/2018(UTC), Vesna on 25/04/2018(UTC), Tim D on 26/04/2018(UTC)
Posted: 27 April 2018 16:21:50(UTC)

Joined: 27/03/2012(UTC)
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When I was faced with this problem..... I spent some of my mum's money ' doing up' the house. I then let it out.... the income from the let and her pension - nearly covered the care costs.
3 users thanked DGL for this post.
john brace on 27/04/2018(UTC), Tim D on 27/04/2018(UTC), Andrew Smith 259 on 27/04/2018(UTC)
Stephen B.
Posted: 28 April 2018 10:12:15(UTC)

Joined: 26/09/2012(UTC)
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You don't mention any siblings, if you have any that's probably the biggest complicating factor. Personally my inclination would be to invest for the long term but intend to cover any shortfall myself - even if you could technically rely on local authority funds I don't get the impression that the quality of care they fund is all that good.
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