Case Studies

These case studies are not based on real clients but are shown for illustration purposes only .

Case Study No. 1

Ellen is currently in receipt of care at a local nursing home and is almost 95 years old.

She has assets in excess of £22,250 and must therefore fund her care fees entirely from her own means. She has income of around £600 per month from all sources including her Attendance Allowance, and her outgoings amount to around £2,000 per month, which covers the home's fees and some personal spending. She therefore needs to find £1,400 per month to meet the shortfall.

Ellen had no assets other than her then empty house, which was valued at £200,000. Although the Local Authority will never force the sale of a property, they will withhold payment of care home fees after a period of 3 months under these circumstances. If the house was sold, we would have the resultant funds with which to find a solution.

Using all the tools available to us, we would be able to ensure that all of Ellen's fees will be paid for the remainder of her life, and over £150,000 invested for her potential beneficiaries. The family would have peace of mind knowing that Ellen was being fully looked after, and that 75% of her estate would have been protected under trust.

Case Study No 2

Lily is 84 years old and lives in a nursing home in Kent .

Lily's family were concerned that her savings would be used up paying for her care at £650 per week, and that eventually her house (the family's projected inheritance) would also disappear. Her savings amounted to some £90,000, and the house was valued at a further £160,000.

Lily was in extremely poor health, and had a limited life expectancy. Specialist Care Plans could be considered and quotations obtained, but the risk of Lily dying sooner rather than later meant the possible loss of capital associated with plans of this type. We would therefore examine pure investment type solutions to provide an income to cover the shortfall in fees.

Lily died within two years, but fortunately, the investment arrangement we would have recommended would have paid out in full the original capital invested on her behalf. The family then would have the benefit of all of her original capital and the house, illustrating that it is possible to protect 100% of the resident's estate with careful planning.

Case Study No 3

Joyce is almost 80 and currently enjoys her stay in a residential home in London .

She is considerably wealthy, and has an income of over £1,700 per month. Her Care fees are in excess of £3,000 per month. She therefore requires an additional income of £1,300 to meet her fees each month.

Because of the degree of wealth she has, she also has a considerable Inheritance Tax problem, to be borne by her grandchildren when she eventually dies.

With the skilful use of Trust planning we would be able to provide an income, tax free, from her investment portfolio, which met the shortfall and immediately removed £118,800 from her estate. Should she live another 7 years, the total removed from her estate would reach £312,000, and she would still enjoy a continuing income. The family has been saved a minimum of £124,800 in Inheritance Tax by this single piece of planning at current tax rates.

Levels, bases and reliefs from taxation are subject to change.   

Case Study No. 4

Edith is 87 and has just gone into full time residential care, funded by the Local Authority.

Tony, her husband remained at home with their 42-year-old disabled son David. Tony and the rest of the family were aware of the ruling that decreed that a spouse remaining in the home after their partner had gone into care meant that the property did not form part of the assets used in the Local Authority financial assessment. However, within 18 months Tony had passed on, and Edith, still being alive and well in the home, inherited the property. Tony and Edith's daughter, aware of the ruling, became immediately concerned for David's security.

The good news is that David, through his disabled status, qualifies to stay in the property for as long as he likes. No charge or other financial pressure will force him to leave. However, if he voluntarily leaves at any point in the future, the property becomes immediately liable for assessment, and Edith, currently enjoying Local Authority funded care, would have to start paying for her care under the current rules. This inevitably would mean the sale of the house to raise funds.

Once again we would be able to use the funds to ensure that Edith enjoyed care in the home of her choice for as long as she lived.
Please click here to read full details about Protecting your Property .

Case Study No. 5

Michael was in residential care until his condition worsened.

Fortunately he was staying in a dual registered home, which had a nursing wing. He was assessed as being entitled to receive theRegistered Nursing Care Contribution (RNCC) and a sum of £101 per week was paid directly to the home to pay for his nursing care. Neither Michael nor any member of his family saw any of this money, and of course the care home fees remained as they had been. Should his condition improve, then a re-assessment would be required and the RNCC could be removed or he could receive NHS continuing care should his condition significantly worsen, and he is deemed as qualifying.

Please click here to read full details about Free Nursing Care .

Case Study No. 6

Joan and James both needed care and were in the process of financial assessment by the Local Authority.

As part of the process, their representative was asked about their assets and replied that they had none. This is not unusual in the case of say, council tenants, but further questions were asked and it was determined that the property in which they lived had been gifted to their children 2 years before, when Joan had started to display signs of the onset of mild dementia. As the property was their sole asset until this point, and as it's value fell below the then Inheritance Tax threshold, the family could come up with no clear or viable explanation for the gift being made. Eventually, although there were other minor reasons for making the gift, it was decided that the avoidance of care fees was a significant part of the reasoning. Joan and James were therefore assessed as still owning the property and the Local Authority withheld funding. Responsibility for the funding then fell to the children as owners of the property.

Had the property been gifted for other reasons, or at a time when there was no foreseeable risk of either party requiring care in the future, the Local Authority could not have reached this decision.

Please click here to read full details about Gifting Assets .

Case Study No. 7

Alan had assets in excess of £22,250 when he moved into care in England. He was therefore privately funded, paying fees of £600 per week.

At the end of 13 months Alan's assets had dropped to below £22,250 and the Local Authority proceeded to offer some degree of help. However, they were limited by their "daily rate", which only allowed them to fund up to a level of £400 per week as a maximum. Alan therefore had to continue to deplete his savings until they reached the lower threshold of £13,500, at which point full financial assistance from the Local Authority should have been forthcoming, and indeed was granted. However, full financial assistance is subject to the same limits as previously mentioned, so Alan was faced with a choice: either move to a less expensive home, with all the upheaval that might entail, or find the extra funding to make up the shortfall.

Legislation would prohibit him from using his remaining £13,500 for this purpose, so any additional funding must come from third parties, in this case his family.

In some cases the care home itself will take on the burden of extra funding on behalf of the resident, in reality just dropping their fees to Local Authority funding levels. In other cases residents have been moved to a "socially funded" wing of the home, where living standards are lower.

Please click here to read full details about Planning for Long Term Care .

Case Study No. 8

Grace has been assessed as needing 24-hour care, but the family wants it to be provided at home.

Grace is in the position of living alone, and having very little in the way of assets, and is therefore Socially funded. Her family believes that care in her own home would be the best option, as Grace has reservations about leaving the property.

Because the Local Authority will be paying in this instance, they really decide the course of action. Providing care in the home for 24 hours a day is a massively expensive process. The Local Authority is always working to limited budgets, and in this case will insist that if they are to pay, then Grace should enter into residential care. However, if she does, the house becomes vacant and enters into the Local Authority financial assessment. This will make Grace a privately funded case.

Unfortunately, her only option is to accept the Local Authority assessment, and go into a residential home, as neither she, nor her family has the funds to pay for care in her own home.

Hypothetically, if Grace needed a lower degree of care, the solution might have been different. Social Services offers a range of packages that may have been suitable, ranging from a simple "rise and retire" package through to something more comprehensive, which may allow for cleaning, meal preparation etc. Every Local Authority has different budget restraints, but will always endeavour to provide a level of service suitable to meet the individual's needs.

Please click here to read full details about Domiciliary Care .