Will and trust questions

My mum is currently looking at updating her will, she’s spoken to a firm who are suggesting setting up some sort of trust as that will allow her to protect her house from being used to pay for care costs, avoid probate, specify various wishes of what happens in different situations of people dying and money then going to grandkids etc.

The firm are saying that the cost for setting up this will and trust is about £4k. Her total assets are probably circa 500k. I’m generally fairly financially literate but I have no experience at all with wills at all.

Does the above sound reasonable? Are there better ways to achieve these outcomes? What sort of accreditation should I be checking this firm has? I need to sense check foe her that this is the sensible thing to do, any other resources that I can use to educate myself

Sounds v expensive to me. Ianal.

same.

you could have a read of this?

https://www.amshousinggroup.com/how-much-does-it-cost-to-put-your-house-in-trust-uk/

Be careful if in Scotland.

https://www.bbc.co.uk/news/uk-scotland-glasgow-west-68348425

A lawyer I know who works in this area says in Scotland it is almost impossible to write a trust to exclude a house from care costs.

The cost itself is not unreasonable as trusts are generally complex.

However the idea that this is a way to avoid care costs is extremely dubious as the local authority would almost certainly view it as being deliberate deprivation of assets (https://www.carehome.co.uk/advice/deprivation-of-assets-to-avoid-paying-for-care-home-fees).  Historically this was not the case but when people started shifting assets into trusts c.25 years ago to avoid care costs, the deprivation of assets rules were introduced.

In addition, unless there are compelling reasons for using trusts, imho they are best avoided as there are significant legal obligations on the trustees (which is why this is a role frequently farmed out to solicitors, which obviously costs money), the need to register them and the potential requirement to submit tax returns.

I’d also say that given how awful some care homes are I would consider spending the cash to give someone you care for (in terms of a loved one) a decent standard of care if they can.

I wouldn’t do this before a potential change of government. Assuming all to be legit it will be based on current tax laws, which could be subject to change…

In terms of accreditation – seek other quotes, see if the price is the same.

There are other means to achieve that end, if you’re so minded. But probably not as lucrative for the legal firm concerned.

My mam passed away yesterday 😞 thankfully the passing bit was very swift, but she’d been in hospital a couple of weeks and was waiting to go to temporary reablement care, then most likely a care home.

For all she didn’t want her house (only maybe £150k) to go on care costs, we were happy that if it did we could use it for her to go to a place that we all were happy with rather than be at the whim of the local authority, and what ever they chose. Obviously we’d all be happy of the money (none of us are well off),  but we were happier at the thought of being able to see Mam on a suitable place.

She looked at a similar transfer of the house options years ago and even then the solicitor essentially said the LA will see right through that and consider it to be asset stripping as above.

Longdog – sorry for your loss.

steve-g – LAs are very switched on to attempts to avoid care home costs so, if that’s your mother’s objective…good luck.

As for inheritance if named beneficiaries pre-decease your mother, that should be a standard inclusion in a will; a solicitor or will writer etc should have a focus on this if there are children/grandchildren involved.

You should check whether any of your mother’s assets would not be covered by a will; for example, a SIPP is not covered and would be subject to an ‘expression of wish’ which is lodged with the SIPP administrator with reference made to it in the will.

I used a solicitor and also did the SIPP thing; by contrast, my ex did what your mother is considering. I asked my solicitor about the possible benefits of using a trust writer – response…no benefits.

Your mother could ask the trust writer if they will fully indemnify her against any claim her LA could make in respect of care home costs.

IANAS, IMHO you need to speak to several experienced legal persons to get a range of views

Reading in to your post a little, but it seems that your mum is on her own??

As above ^^ my understanding is that she’ll struggle to set a workable, reasonably-priced trust up if that’s the case.

If she lives with a beneficiary then she can probably split the property as tenants in common; a trust will for that should be less than £1k assuming two persons.

Gifting her house early is fraught with problems if she continues to live there.

Bookmarking thread as my parents are redoing their will.

For all she didn’t want her house (only maybe £150k) to go on care costs, we were happy that if it did we could use it for her to go to a place that we all were happy with rather than be at the whim of the local authority, and what ever they chose. Obviously we’d all be happy of the money (none of us are well off), but we were happier at the thought of being able to see Mam on a suitable place.

Situation I’m in with my parents. Terrified of not being able to pass on their house to me, but their house is theirs, I’d sooner use it see them get quality care to see out their days, wherever that needs to be. No way am I relying on the local authorities.

Thanks all.

Yes she is on her own.

No SIPP involved as I believe when she retired you had to buy an annuity with any pension funds you had set aside, in addition to a teaching pension.

Have said to her she needs to chat to another firm or 2 to see what they say, and that the avoidance of care fees seems to be a shaky promise. Looking at the wording provided by the advisor it’s not on their email describing the benefits, and then in the brochure it’s along the lines of ‘can help to protect your assets from being used to cover care costs’ or something similarly wooly. On her notes however this was the first thing written down so will find out how important that is to her, and then also as mentioned above maybe suggest that spending the money she has on a decent care home might actually be a good idea.

The second item on her list was the hierarchy set up for if others pre-decease her so good to know that can be achieve much more cheaply.

As a general note, anyone over 55 can get a basic, e.g. not including trusts, will from many “proper” solicitors for free… https://freewillsmonth.org.uk/

Speaking from experience, don’t forget about getting a POA.
My mum just passed away, and while I managed without it, if I had one it would’ve been less hassle/stress if I had one. People don’t just get old and die, sometimes their brain goes and then everything gets harder to organise as you have no access to any of their personal stuff like bank accounts to pay bills etc…

Yeh we had a POA in place for some time as my brother was managing my mam’s shopping/bills/finances for a few years due to Alzheimer’s.

POA, you may aswell do it yourself, it’s just a few forms to print out, one for financial and a seperate one for medical, signed/witnesed from the government website and sent back/registered.

It’s a fixed fee for each one, so no point getting a solicitor to to that bit, IMO.

Based on my experience I’d say you’re *better* doing the PoA yourself, the solicitors **** up my parents’ ones. Luckily spotted and redone in the nick of time. Read and note the clear warnings about “jointly” vs “jointly and severally” and the rules about replacement attorneys if either is applicable.