Deprivation of assets - redistributing wealth
Discussion
I have a situation unfolding with my grandparents in which my Grandad needed to be dumped into short term respite care with little to no warning or preparation. We're looking to get him back home within the next few days, and the paperwork has started flooding into my Gran which is confusing her a bit. Normally we'd sit with her and go through it all, but circumstances are not quite normal!
I'm vaguely aware of the £23500(?) asset limits for the care cost thresholds - there's no real danger of them falling beneath that threshold so this isn't a post about how we can worm our way out of some costs - but it has made us review the finances a little bit and realise that their assets are all heavily weighted towards my Grandad. He's highly likely to require more long-term care in the very near future, whereas my Grandma has no such issues on the horizon and could possibly plod along self sufficiently for years to come. The way I understand it any long term care that he got would drain the vast majority of their savings as things stand right now, leaving my Gran a little short on cash. Ultimately she'd survive, but as she's 10 years junior to my Grandad and in a bit of a better state (but not much...) I'd like to think she could enjoy her cash a bit once the inevitable happens
The obvious answer would be to just call the banks now and start redistributing all of their stuff so that it's 50:50 - but since there's an ongoing process to pay for the respite care I don't want her raising any red flags that could suggest 'deprivation of assets'. Does DoA exist within a married couple or does it only apply if the money started to leave their 'estate' and end up in the pockets of children, grandkids, etc?
I do have access to somebody I could formally ask for advice - but I don't want to raise any red flags by even asking at this stage.... probably being a bit paranoid
Hoping PH can point me in the right direction initially so that I can plan the next steps.
I'm vaguely aware of the £23500(?) asset limits for the care cost thresholds - there's no real danger of them falling beneath that threshold so this isn't a post about how we can worm our way out of some costs - but it has made us review the finances a little bit and realise that their assets are all heavily weighted towards my Grandad. He's highly likely to require more long-term care in the very near future, whereas my Grandma has no such issues on the horizon and could possibly plod along self sufficiently for years to come. The way I understand it any long term care that he got would drain the vast majority of their savings as things stand right now, leaving my Gran a little short on cash. Ultimately she'd survive, but as she's 10 years junior to my Grandad and in a bit of a better state (but not much...) I'd like to think she could enjoy her cash a bit once the inevitable happens
The obvious answer would be to just call the banks now and start redistributing all of their stuff so that it's 50:50 - but since there's an ongoing process to pay for the respite care I don't want her raising any red flags that could suggest 'deprivation of assets'. Does DoA exist within a married couple or does it only apply if the money started to leave their 'estate' and end up in the pockets of children, grandkids, etc?
I do have access to somebody I could formally ask for advice - but I don't want to raise any red flags by even asking at this stage.... probably being a bit paranoid
Hoping PH can point me in the right direction initially so that I can plan the next steps.From the leaflet on the link below, it's well worth a look,
"Only your own resources should be considered. Local authorities cannot generally assess joint resources of couples. They can only look at your own capital and income. This includes income and savings in your sole name. Jointly held savings are divided equally in the financial assessment, unless evidence shows your share is unequal."
https://www.ageuk.org.uk/globalassets/age-uk/docum...
"Only your own resources should be considered. Local authorities cannot generally assess joint resources of couples. They can only look at your own capital and income. This includes income and savings in your sole name. Jointly held savings are divided equally in the financial assessment, unless evidence shows your share is unequal."
https://www.ageuk.org.uk/globalassets/age-uk/docum...
rockin said:
From the leaflet on the link below, it's well worth a look,
"Only your own resources should be considered. Local authorities cannot generally assess joint resources of couples. They can only look at your own capital and income. This includes income and savings in your sole name. Jointly held savings are divided equally in the financial assessment, unless evidence shows your share is unequal."
https://www.ageuk.org.uk/globalassets/age-uk/docum...
Many thanks, I've reviewed a different (but very similar) PDF this morning - understanding that the joint accounts will be split is sort of bad news for us at the moment but was to be expected."Only your own resources should be considered. Local authorities cannot generally assess joint resources of couples. They can only look at your own capital and income. This includes income and savings in your sole name. Jointly held savings are divided equally in the financial assessment, unless evidence shows your share is unequal."
https://www.ageuk.org.uk/globalassets/age-uk/docum...
Their split of assets is something in the region of:
Him: 45%
Her: 20%
Joint: 35%
So if he got whisked off into full time care right now, I understand it to mean that 62.5% of their savings would effectively be spoken for by his care costs. Any big/unusual spend (whilst he's in care, or on the immediate run up to it) would invoke some sort of DoA investigation.
My hope is that we can reshuffle it into a 25/25/50 split or something similar so that at worst my Gran will get to retain 50% of their savings if the worst does happen.
Whatever you decide, keep in mind that local authorities 'can', as far as understand, look back into finical records - going back five years.
Whether they actually have the time/resources/inclination to actually do it is another thing.
I found myself looking into this when my Dad had to go into care ..... his financial situation wasn't too bad (ie he wasn't too far above the threshold) - but my Mum had a substantial amount in her account from an inheritance that came to her many years ago.
As a family we decided the best thing to do was to leave a 'manageable' amount in her account and her 3 sons were gifted the rest as Premium Bonds on the understanding that it was still Mums money.
We (the family) may get clobbered for inheritance tax further down the road (which would happen anyway) - but should Mum have to go into care anytime in the near future, and if the local authority were to look into her finances - as Mum has no underlying health problems at the moment they couldn't claim the money was transferred to avoid care costs.
Whether they actually have the time/resources/inclination to actually do it is another thing.
I found myself looking into this when my Dad had to go into care ..... his financial situation wasn't too bad (ie he wasn't too far above the threshold) - but my Mum had a substantial amount in her account from an inheritance that came to her many years ago.
As a family we decided the best thing to do was to leave a 'manageable' amount in her account and her 3 sons were gifted the rest as Premium Bonds on the understanding that it was still Mums money.
We (the family) may get clobbered for inheritance tax further down the road (which would happen anyway) - but should Mum have to go into care anytime in the near future, and if the local authority were to look into her finances - as Mum has no underlying health problems at the moment they couldn't claim the money was transferred to avoid care costs.
A few points to be aware of:
Moving money from one partner to another in order to 'protect' savings is the very essence of DoA if there's any reasonable expectation care will be needed. Being healthy when you move the money doesn't mean this can't apply.
If money is moved to relatives on the basis it's Mum's, then the relatives will need to give it back if Mum needs care and the LA decides there was a reasonable expectation care would need to be funded. Spent the money? Doesn't matter, Mum will be assessed as if she still has it and the Council can go after the relatives for care costs.
I'm not aware of a five year limit in the stat guidance or the Care Act. But plenty of councils do decide there has been DoA and assess / charge accordingly. Some are better than others at investigating, but if there's existing care needs / poor health, and money is given away, then it's likely to be considered DoA. The statutory guidance sets out the tests councils need to consider when deciding such cases.
Moving money from one partner to another in order to 'protect' savings is the very essence of DoA if there's any reasonable expectation care will be needed. Being healthy when you move the money doesn't mean this can't apply.
If money is moved to relatives on the basis it's Mum's, then the relatives will need to give it back if Mum needs care and the LA decides there was a reasonable expectation care would need to be funded. Spent the money? Doesn't matter, Mum will be assessed as if she still has it and the Council can go after the relatives for care costs.
I'm not aware of a five year limit in the stat guidance or the Care Act. But plenty of councils do decide there has been DoA and assess / charge accordingly. Some are better than others at investigating, but if there's existing care needs / poor health, and money is given away, then it's likely to be considered DoA. The statutory guidance sets out the tests councils need to consider when deciding such cases.
You are in a very difficult situation trying to sort this out when your granddad is already requiring care. I am not an expert but have been thro a similar situation with both my parents
Each person is assessed separately. Not sure what you have included in assets but assuming that this does not include any property and only is for savings (which would include stocks and shares etc) as I understand it an assessment at the moment would be for bank/savings accounts in each individual name to include as there own and then for any joint accounts to be split 50/50. So of for example gdad £60k/gma.£10/ joint £30k then granddad would be assessed as having £75k, grandma £25k and as such granddad would be above £23k limit and would have to pay for own care in full.
From memory seem to recall that there was a free period (about 6weeks) during which the local authority paid for the care
This does not take account of the income source (pensions/dividends etc) and would be worth looking at the source and paying these into individual accounts. Without numbers it is difficult to decide.but may help to place more of future income under your grandma's individual ownership and outside the assessment for granddad.
Would then need to look at future situation in particular in relationship to house ownership. Whilst one of the partnership is living in the house the local authority will not take its value into consideration.
Sort the current situation out,change income sources into individual accounts if this means more under control of your grandma.
When that,s done come back about house ownership.
Don't accept everything that the local authority tells you- just speaking from my experience..
Hope granddad makes a speedy recovery.
Each person is assessed separately. Not sure what you have included in assets but assuming that this does not include any property and only is for savings (which would include stocks and shares etc) as I understand it an assessment at the moment would be for bank/savings accounts in each individual name to include as there own and then for any joint accounts to be split 50/50. So of for example gdad £60k/gma.£10/ joint £30k then granddad would be assessed as having £75k, grandma £25k and as such granddad would be above £23k limit and would have to pay for own care in full.
From memory seem to recall that there was a free period (about 6weeks) during which the local authority paid for the care
This does not take account of the income source (pensions/dividends etc) and would be worth looking at the source and paying these into individual accounts. Without numbers it is difficult to decide.but may help to place more of future income under your grandma's individual ownership and outside the assessment for granddad.
Would then need to look at future situation in particular in relationship to house ownership. Whilst one of the partnership is living in the house the local authority will not take its value into consideration.
Sort the current situation out,change income sources into individual accounts if this means more under control of your grandma.
When that,s done come back about house ownership.
Don't accept everything that the local authority tells you- just speaking from my experience..
Hope granddad makes a speedy recovery.
twokcc said:
You are in a very difficult situation trying to sort this out when your granddad is already requiring care. I am not an expert but have been thro a similar situation with both my parents
Each person is assessed separately. Not sure what you have included in assets but assuming that this does not include any property and only is for savings (which would include stocks and shares etc) as I understand it an assessment at the moment would be for bank/savings accounts in each individual name to include as there own and then for any joint accounts to be split 50/50. So of for example gdad £60k/gma.£10/ joint £30k then granddad would be assessed as having £75k, grandma £25k and as such granddad would be above £23k limit and would have to pay for own care in full.
From memory seem to recall that there was a free period (about 6weeks) during which the local authority paid for the care
This does not take account of the income source (pensions/dividends etc) and would be worth looking at the source and paying these into individual accounts. Without numbers it is difficult to decide.but may help to place more of future income under your grandma's individual ownership and outside the assessment for granddad.
Would then need to look at future situation in particular in relationship to house ownership. Whilst one of the partnership is living in the house the local authority will not take its value into consideration.
Sort the current situation out,change income sources into individual accounts if this means more under control of your grandma.
When that,s done come back about house ownership.
Don't accept everything that the local authority tells you- just speaking from my experience..
Hope granddad makes a speedy recovery.
Thank for you for this, altering the income source is something that I'd not really considered but that could allow us to legitimately reshuffle the balance a bit over the next year or so.Each person is assessed separately. Not sure what you have included in assets but assuming that this does not include any property and only is for savings (which would include stocks and shares etc) as I understand it an assessment at the moment would be for bank/savings accounts in each individual name to include as there own and then for any joint accounts to be split 50/50. So of for example gdad £60k/gma.£10/ joint £30k then granddad would be assessed as having £75k, grandma £25k and as such granddad would be above £23k limit and would have to pay for own care in full.
From memory seem to recall that there was a free period (about 6weeks) during which the local authority paid for the care
This does not take account of the income source (pensions/dividends etc) and would be worth looking at the source and paying these into individual accounts. Without numbers it is difficult to decide.but may help to place more of future income under your grandma's individual ownership and outside the assessment for granddad.
Would then need to look at future situation in particular in relationship to house ownership. Whilst one of the partnership is living in the house the local authority will not take its value into consideration.
Sort the current situation out,change income sources into individual accounts if this means more under control of your grandma.
When that,s done come back about house ownership.
Don't accept everything that the local authority tells you- just speaking from my experience..
Hope granddad makes a speedy recovery.
We're still reviewing the finances in a bit more detail but the balance may be a little more even between the pair of them than we first thought - so there's some good news.
I've made contact with a local dementia society type thing that had offered to help get all of my Grandparents' affairs in order pre-Covid. Our second meeting with them actually was due on the day of lockdown so that all got a bit scuppered. Nevertheless I've found an e-mail contact so I'm going to run this scenario past them and see what they can recommend. As we're not trying to cheat the system at all, just trying to protect both Grandparents for any future care scenarios I'm feeling a little more comfortable talking to somebody about this formally.
Sounds good if you can place grandma's income in her own account and this will help to distribute this more equitably.
If large amount in joint account and grandma not had pension etc paid into her own account may be a way of adjusting split of joint account but if this is only small may not be worth spending time on.
Once got further income streams split between individuals may be worth looking at house ownership and considering changing ownership from joint tenants to tenants in common which may also mean changing wills.
Presume they don't own any property other than their main residence.-if do this would complicate matters.
Edit just another thought has grandma had any income source in her working life- if not may be a way of arguing that all house expenses have been paid out of granddads income and accordingly grandma should not have to contribute to any of the house running costs from now on. Think local authority would look at how house accounts have been paid since pensionable age so may not help. In my case, mother never worked and didn't have a bank account of her own and less than £5k in saving-premium bonds) and very small pension. So didn.t have to contribute to her own care home fees- whereas farther(in went into care later) had to pay 100% of fees because of savings etc.
Other things that may come into play are carers allowance and pension credit-again will depend on circumstances.
As said in first post it can be a minefield sorting all these things out and if it goes wrong DWP assume that it has been done deliberately but ,that's another story.'
If large amount in joint account and grandma not had pension etc paid into her own account may be a way of adjusting split of joint account but if this is only small may not be worth spending time on.
Once got further income streams split between individuals may be worth looking at house ownership and considering changing ownership from joint tenants to tenants in common which may also mean changing wills.
Presume they don't own any property other than their main residence.-if do this would complicate matters.
Edit just another thought has grandma had any income source in her working life- if not may be a way of arguing that all house expenses have been paid out of granddads income and accordingly grandma should not have to contribute to any of the house running costs from now on. Think local authority would look at how house accounts have been paid since pensionable age so may not help. In my case, mother never worked and didn't have a bank account of her own and less than £5k in saving-premium bonds) and very small pension. So didn.t have to contribute to her own care home fees- whereas farther(in went into care later) had to pay 100% of fees because of savings etc.
Other things that may come into play are carers allowance and pension credit-again will depend on circumstances.
As said in first post it can be a minefield sorting all these things out and if it goes wrong DWP assume that it has been done deliberately but ,that's another story.'
Edited by twokcc on Friday 1st May 10:19
This is not a judgement in any way, but you need to.be careful how you describe things. Moving money from one person to another so as not to pay care fees, and to allow the other person to enjoy the money, is the essence of DoA. I'm not going to tell you what I do for a living, but I know how a lot of councils would (and if you look at the Care Act) should view such action.
Even if you successfully move the money what it does is simply limit the care options for one person. Councils will pay a maximum rate for care which will generally limit the options available.
Even if you successfully move the money what it does is simply limit the care options for one person. Councils will pay a maximum rate for care which will generally limit the options available.
Thanks both for the input. Just to be clear we are not trying to avoid paying for any care right now, my Grandad has had some fantastic emergency respite care because my Gran had an accident. She's on the mend now and he'll be home on Monday all being well. Covid obviously threw some quite big challenges at us throughout this but it seems like many bullets have hopefully been dodged.
What this has done though is made us realise that their savings are heavily weighted towards one person in terms of the named accounts. Even if they completely redistributed everything they had to be 50:50, then both would still be well above the £23.5k threshold for the care allowance. We're not trying to get one person beneath that threshold, I just want to make sure that if my Grandad ends up in long term care in the future - that my Gran is not left with very little just because the accounts happened to be organised the way they are.
So for example say my Grandad had £100k to his name and my Nan had £30k - it's not that drastic but just for the sake of example. Both would be paying full cost for care but as Grandad is most likely to need a long term care arrangement soon (he's 10 years her senior and diagnosed with alzheimers) it would drain a large proportion of their savings, which are joint in everything other than the names on the accounts. My Gran would then be left to live what I would hope is another 10-15 years in relative health and fitness with her savings considerably eroded. If there was a chance of both of them needing care within a similar time frame then I wouldn't be too bothered - as the end result is much the same.
If reshuffling their savings accounts (probably just moving everything into the joint account they already have) is going to be viewed as DoA then we simply won't bother, as we find more and more ISAs and accounts hidden away the balance is becoming less and less drastic in favour of my Grandad anyway.
What this has done though is made us realise that their savings are heavily weighted towards one person in terms of the named accounts. Even if they completely redistributed everything they had to be 50:50, then both would still be well above the £23.5k threshold for the care allowance. We're not trying to get one person beneath that threshold, I just want to make sure that if my Grandad ends up in long term care in the future - that my Gran is not left with very little just because the accounts happened to be organised the way they are.
So for example say my Grandad had £100k to his name and my Nan had £30k - it's not that drastic but just for the sake of example. Both would be paying full cost for care but as Grandad is most likely to need a long term care arrangement soon (he's 10 years her senior and diagnosed with alzheimers) it would drain a large proportion of their savings, which are joint in everything other than the names on the accounts. My Gran would then be left to live what I would hope is another 10-15 years in relative health and fitness with her savings considerably eroded. If there was a chance of both of them needing care within a similar time frame then I wouldn't be too bothered - as the end result is much the same.
If reshuffling their savings accounts (probably just moving everything into the joint account they already have) is going to be viewed as DoA then we simply won't bother, as we find more and more ISAs and accounts hidden away the balance is becoming less and less drastic in favour of my Grandad anyway.
Re moving all to a joint account.
From my experience I would leave the individual accounts as they are. Would appear that both had agreed on how investments were to be made and determining the exact source of where the money cane from may be impossible if investments were made some years ago.Would look at how joint account is funded and what expense are paid out of it so that you have information available when requested by local authority. Would at same time be able to project forward on if account will remain in surplus based on existing living costs. These could change once Granddad has to pay fees . Assessment will be every year and by moving all accounts into joint account grandma could possibly finishing up paying 50% towards granddads care fees. Open a separate account in his name. feed this from his investments and made all payments specially for his care from this account. .Also maybe unlikely but if grandma should ever have to be assessed you have not changed anything from how it is now.
When you are about to have meeting post on here again- just deleted advise about assessment meeting , will post later
From my experience I would leave the individual accounts as they are. Would appear that both had agreed on how investments were to be made and determining the exact source of where the money cane from may be impossible if investments were made some years ago.Would look at how joint account is funded and what expense are paid out of it so that you have information available when requested by local authority. Would at same time be able to project forward on if account will remain in surplus based on existing living costs. These could change once Granddad has to pay fees . Assessment will be every year and by moving all accounts into joint account grandma could possibly finishing up paying 50% towards granddads care fees. Open a separate account in his name. feed this from his investments and made all payments specially for his care from this account. .Also maybe unlikely but if grandma should ever have to be assessed you have not changed anything from how it is now.
When you are about to have meeting post on here again- just deleted advise about assessment meeting , will post later
Just reread your first post, looks as if granddad will be returning home. That will involve an assessment of his care needs which is presumably part of the paperwork that has to be dealt with.
Depending of outcome of this if grandma can look after him with some home care assistance this will be determined and he will have to pay for this but grandma will be able to claim carers allowance(again another form to complete). Over time home care assistance may reduce.
Carers allowance is not means tested and will continue whilst ever needs of person being cared for remain the same.
Depending of outcome of this if grandma can look after him with some home care assistance this will be determined and he will have to pay for this but grandma will be able to claim carers allowance(again another form to complete). Over time home care assistance may reduce.
Carers allowance is not means tested and will continue whilst ever needs of person being cared for remain the same.
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