Preserving the assets of elderly people from care fees

My wife and I own our house jointly and we have about £50,000 in savings. My wife is in an advanced stage of dementia and I am very worried that if I die and she goes into care all our assets will be taken and there will be nothing left for our children. Can I do anything about this?

First of all, do you and your wife have Wills?

Yes, we do and we have left everything to each other in these..

..and are your house and other investments in joint names?

Yes

Then the answer is to change your Will and the way you own your house and savings so they don’t pass to your wife. I’m afraid she will be unable to make changes to her Will as she won’t understand it, so this is only going to be effective if you die first as her original Will still leaves everything to you.

Let’s look at the house and savings first. The house is currently owned by you and your wife as joint tenants which means on the first death it will automatically pass by survivorship to the other spouse. We want to change this and leave your share under your Will to your children.

How do I do this?

It’s a simple exercise. We draw up a Notice of severance of your joint tenancy which is signed and registered at the Land Registry if the title to the property is registered, or attached to the Conveyance when you bought the house if it is unregistered.

Most of your savings are in your joint names which would, again, pass directly to the survivor on the first death, so I would suggest that you transfer your share of these into your sole name.

…and what changes do I need to make to my Will?

Your Will needs to be rewritten as any assets in your sole name i.e. your share of the house and your investments, can now pass under the Will. Now, you have to decide whether these are left directly to your children or you make provision for your wife’s future needs. As you have a legal and a moral duty to maintain your wife, my advice is that you make provision for her in your Will. You can do this by leaving your share of the house and your investments in trust for your wife’s use during her life and on her death, to your children.

Who should be my Trustees and what do they actually do?

I would suggest you have professional Trustees i.e. a solicitor’s firm such as Fisher Jones Greenwood to carry out your wishes and ensure your wife’s needs are met and the investments protected.

Your Trustees will be given powers to invest your assets (for example the sale proceeds of your share of the house) and pay your wife any interest from such investments which could help towards her care and to purchase anything she may need to make her life more comfortable. This way, you will have fulfilled your duty to make provision for your wife and on her death, your children will inherit the Investments.

If you need more information on the above matters contact Kate Wombwell on 01206 217585 or e.mail privateclient@fjg.co.uk