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  • FIRST POST
    • Mrs p
    • By Mrs p 9th Sep 17, 12:20 AM
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    Mrs p
    I need to find best way to invest my mother's money.....help please!
    • #1
    • 9th Sep 17, 12:20 AM
    I need to find best way to invest my mother's money.....help please! 9th Sep 17 at 12:20 AM
    My mum and dad owned their own house, unfortunately my mother was diagnosed with Alzheimer's fairly young at 65 she began to decline quite quickly but at the time my father had power of attorney but sadly passed away three years ago.

    As mum had declined very quickly she was hospitalised and then placed in care under section 2 of the mental health act and therefore their savings, capital and property is not considered in the costs for her care (small mercies) as she has been considered in "continuing care" which means that I only have to pay the small shortfall between what the home charges and what she receives in her pension and what the local council and nhs pay for her care.

    I applied to be mums financial deputy and was awarded the deputyship. It has taken 12 months but today we finally sold the family home. Mum now has just under £100,000.00 in her current account.
    My questions are:
    1. Where would you place the money to get the best and safest return?
    2. Would you split it as I understand you are only insured up to £85 grand per account?
    3. Would you do it yourself or pay for financial advice?

    I am very new to this and did ring the court of protection to confirm I could move the money in to a higher interest/invest the money and although they agreed it was ok they said it was important to get financial advice.

    Sorry for the essay but thought it was important to give as much pertinent info at this stage to ensure clarity in my situation.

    Thanking you in anticipation of advice
Page 1
    • TheShape
    • By TheShape 9th Sep 17, 1:03 AM
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    TheShape
    • #2
    • 9th Sep 17, 1:03 AM
    • #2
    • 9th Sep 17, 1:03 AM
    My first question would be:

    What is the shortfall in care costs that you are currently paying? I imagine the aim would be to try to cover that at least.
    • bigadaj
    • By bigadaj 9th Sep 17, 6:57 AM
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    bigadaj
    • #3
    • 9th Sep 17, 6:57 AM
    • #3
    • 9th Sep 17, 6:57 AM
    I would have thought that care costs will be significant and the current account will reduce quite quickly such that you will be within fscs limts with a few months.

    Financial advice is often expensive and given the short term need for the money there's little extra that can be done to gain much more interest.

    Might be worth looking into a care needs annuity through a specialist ifa, they can appear expensive but give certainty that expenses will be covered for as long as needed, you'd need to go through an adviser that is a specialist in later life advice, would be useful to try just to see what the overall costs could be even if you don't or can't take advantage of this form of insurance.
    • Mrs p
    • By Mrs p 9th Sep 17, 6:57 AM
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    Mrs p
    • #4
    • 9th Sep 17, 6:57 AM
    • #4
    • 9th Sep 17, 6:57 AM
    Thank you for your reply

    After writing an essay I forgot to mention that my mother has other income from spousal occupational pensions, this covers the shortfall and any miscellaneous purchases. As she needs little as the home provides all her needs except treats and extras she has a small balance of around £9000. The proceeds from the house are in excess and are just sitting in a current account.
    • tacpot12
    • By tacpot12 9th Sep 17, 7:10 AM
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    tacpot12
    • #5
    • 9th Sep 17, 7:10 AM
    • #5
    • 9th Sep 17, 7:10 AM
    I think you need professional independent financial advice, Yoir mother's situation is not uncommon but most non-professionals won't have experience of the situation themselves so won't be offer good quality advice. Look for an Independent financial advisor at www.unbiased.co.uk

    You also have a duty to minimise the cost of the advice you take, so you need to be prepared to ask searching questions about what the charges are and what the IFA is doing for the charges. Talk to a few IFAs to get a feel for what is reasonable. Post a question on MSE if you are not sure about whether the fee structure is reasonable.

    You need to think carefully about what your mum needs now and might needs in the future and how long she might needs it for. Make notes on your views to take to the IFA but be prepared for them to ask questions that alter your views.

    Opening a Santander 1-2-3 account and moving £20K into it would be a way of getting below the £85K FSCS limit, if your Mum doesn't already have this accoint and you can meet the account criteria.
    • FatherAbraham
    • By FatherAbraham 9th Sep 17, 7:48 AM
    • 737 Posts
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    FatherAbraham
    • #6
    • 9th Sep 17, 7:48 AM
    • #6
    • 9th Sep 17, 7:48 AM
    Thank you for your reply

    After writing an essay I forgot to mention that my mother has other income from spousal occupational pensions, this covers the shortfall and any miscellaneous purchases. As she needs little as the home provides all her needs except treats and extras she has a small balance of around £9000. The proceeds from the house are in excess and are just sitting in a current account.
    Originally posted by Mrs p
    So what is this £100k actually for? What is the financial goal to be satisfied? Until you determine that, noöne can help you achieve it.

    It would be prudent to ensure that the capital is not exposed to unnecessary risk, by not keeping more than £85k in a single institution (more accurately: by not holding more than £85k in a single bankinvg licence), or by moving the money to a National Savings and Investments account, fully backed by the state.

    Warmest regards,
    FA
    • Keep pedalling
    • By Keep pedalling 9th Sep 17, 9:39 AM
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    Keep pedalling
    • #7
    • 9th Sep 17, 9:39 AM
    • #7
    • 9th Sep 17, 9:39 AM
    Having deputyship puts you under considerable scrutiny by the courts, so you must be careful what you do with this. Assuming your mother's dementia is quite advanced then investing the money is out of the question, and the main priority is protection.

    I would keep it simple and put the bulk of it into NS&I where it has full protection.
    • xylophone
    • By xylophone 9th Sep 17, 9:58 AM
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    xylophone
    • #8
    • 9th Sep 17, 9:58 AM
    • #8
    • 9th Sep 17, 9:58 AM
    It would seem that your mother's needs are covered by the NHS and her pensions so that any income produced form her capital (the proceeds of the house sale) are over and above what is needed to fund her care.

    The money could be invested (and would be likely to produce a better return if invested) but if you are inexperienced with this, you could consult an IFA.

    https://societyoflaterlifeadvisers.co.uk/

    Otherwise there are various savings accounts that could be opened by you as Deputy for your mother.

    http://www.thisismoney.co.uk/money/article-1621507/Best-savings-rates-Fixed-rate-accounts.html

    You could open an NS&I Income Bonds account in your mother's name to hold the cash for a couple of months while you consider the options.

    https://www.nsandi.com/our-products
    • DiggerUK
    • By DiggerUK 9th Sep 17, 9:59 AM
    • 2,750 Posts
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    DiggerUK
    • #9
    • 9th Sep 17, 9:59 AM
    • #9
    • 9th Sep 17, 9:59 AM
    ..........she was hospitalised and then placed in care under section 2 of the mental health act and therefore their savings, capital and property is not considered in the costs for her care (small mercies) as she has been considered in "continuing care"........)
    Originally posted by Mrs p
    If your mum is indeed receiving continuing health care, then the NHS is responsible for all her costs. So there will be no shortfall to make up.

    http://www.nhs.uk/Conditions/social-care-and-support-guide/Pages/nhs-continuing-care.aspx

    As to your mums funds, I'm with others who say it will be best put in savings accounts that do their best to match, or offset, inflation. NSI will have enough options..._
    I am not now, nor have I ever been, a Financial Adviser.
    Forward, to the 'British Spring'
    • bigadaj
    • By bigadaj 9th Sep 17, 10:54 AM
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    bigadaj
    It would seem that your mother's needs are covered by the NHS and her pensions so that any income produced form her capital (the proceeds of the house sale) are over and above what is needed to fund her care.

    The money could be invested (and would be likely to produce a better return if invested) but if you are inexperienced with this, you could consult an IFA.

    https://societyoflaterlifeadvisers.co.uk/

    Otherwise there are various savings accounts that could be opened by you as Deputy for your mother.

    http://www.thisismoney.co.uk/money/article-1621507/Best-savings-rates-Fixed-rate-accounts.html

    You could open an NS&I Income Bonds account in your mother's name to hold the cash for a couple of months while you consider the options.

    https://www.nsandi.com/our-products
    Originally posted by xylophone
    I can't see how investment is a good place for the money in the case.

    Adviser charges could be significant as well.
    • xylophone
    • By xylophone 9th Sep 17, 11:49 AM
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    xylophone
    I can't see how investment is a good place for the money in the case.
    It may well not be - I simply commented on the likelihood ( but of course not certainty) of a better return if it were.

    That said,

    any income produced form her capital (the proceeds of the house sale) are over and above what is needed to fund her care.
    so that it could be argued that it is not absolutely necessary to generate any return at all!

    One assumes that after "temporary high balance" period expired, the OP would want to leave no more than £85,000 with any one institution ( other than NS&I) but that is easily managed.

    The OP may be happy simply to leave it all with NS&I at 0.75%.

    It's up to her.
    • Mrs p
    • By Mrs p 9th Sep 17, 2:53 PM
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    Mrs p
    Thank you all for your replies.

    To clarify a few points, the capital from the sale of mums house is in a current account earning no interest and is in excess of the £85 G that is insured.

    Mum is not very well and as such I am not sure putting the capital into fixed term bonds would be prudent as it is possible that it may sadly go through probate in less than 12 months.


    In retrospect investing that capital is something I am too inexperienced to do with any confidence and wouldn't want to take the gamble with someone else's money.

    This leaves me with the option of splitting the money into two accounts and try to get the best interest or in NS&I .

    I have never had the responsibility for this type of capital before and I was panicking about doing the best for mum.

    Have to say I'm appalled at the interest offered on savings from the high street banks but am too inexperienced to try anything unfamiliar.
    • greenglide
    • By greenglide 9th Sep 17, 5:07 PM
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    greenglide
    Have to say I'm appalled at the interest offered on savings from the high street banks
    Why?

    Current base rate is 0.25%. Paying significantly more than that is a bit like a supermarket paying you to take bread, milk etc away. It just doesn't make sense.

    Largely people are happier getting 5% when interest rates are 6% or more because they feel happier getting a larger number even though they are still making a loss.
    • kidmugsy
    • By kidmugsy 9th Sep 17, 5:59 PM
    • 9,629 Posts
    • 6,384 Thanks
    kidmugsy
    To clarify a few points, the capital from the sale of mums house is in a current account earning no interest and is in excess of the £85 G that is insured.

    Mum is not very well and as such I am not sure putting the capital into fixed term bonds would be prudent as it is possible that it may sadly go through probate in less than 12 months.

    In retrospect investing that capital is something I am too inexperienced to do with any confidence and wouldn't want to take the gamble with someone else's money.

    This leaves me with the option of splitting the money into two accounts and try to get the best interest or in NS&I.
    Originally posted by Mrs p
    When you are already shaken by your father's recent death and your mother's decline, and when you face the prospect of grief to come, you would be ill advised to try messing around with tricks like opening multiple high interest current accounts and regular savers. In your shoes I'd be ill advised to do it, and I do have some experience of these things. Grief can knock you for six. Take care of yourself so that you can do your best for your mother.

    Neither investing the money nor even using fixed term bank accounts seem likely to make much sense in this case. As you have inferred, the sensible thing is to move the cash, or much of it, so that its value is guaranteed and it at least earns some modest interest. In your shoes I'd be looking at ns&i.
    • le loup
    • By le loup 9th Sep 17, 6:02 PM
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    le loup
    In your shoes I'd be looking at ns&i.
    Originally posted by kidmugsy
    Excellent advice.
    • bigadaj
    • By bigadaj 9th Sep 17, 6:38 PM
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    bigadaj
    It may well not be - I simply commented on the likelihood ( but of course not certainty) of a better return if it were.

    That said,



    so that it could be argued that it is not absolutely necessary to generate any return at all!

    One assumes that after "temporary high balance" period expired, the OP would want to leave no more than £85,000 with any one institution ( other than NS&I) but that is easily managed.

    The OP may be happy simply to leave it all with NS&I at 0.75%.

    It's up to her.
    Originally posted by xylophone
    Yes, that's exactly my point(s).
    • xylophone
    • By xylophone 9th Sep 17, 7:18 PM
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    xylophone
    Current base rate is 0.25%.
    Indeed - and CPI inflation was 2.6 % in July with RPI at 3.6%......
    • xylophone
    • By xylophone 12th Sep 17, 12:15 PM
    • 22,881 Posts
    • 13,243 Thanks
    xylophone
    Indeed - and CPI inflation was 2.6 % in July with RPI at 3.6%......
    and 2.9 and 3.9 in August.....

    http://www.telegraph.co.uk/business/2017/09/12/pound-jumps-132-against-dollar-ahead-key-uk-inflation-figures/
    • jimjames
    • By jimjames 12th Sep 17, 12:20 PM
    • 12,019 Posts
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    jimjames
    Largely people are happier getting 5% when interest rates are 6% or more because they feel happier getting a larger number even though they are still making a loss.
    Originally posted by greenglide
    I'm happy getting 5% when base rate is 0.25%. Obviously it's a lot easier with £10k than £100k.

    In the circumstances outlined there isn't really a lot of option to improve on the rates. I would suggest to the OP that if they expect that they may need to take action in 12 months or so then they should start investigating investment options so that they are fully informed by the time they need to do something longer term wit the money.
    Last edited by jimjames; 12-09-2017 at 12:22 PM.
    Remember the saying: if it looks too good to be true it almost certainly is.
    • Linton
    • By Linton 12th Sep 17, 12:40 PM
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    Linton
    Another vote for NS&I. It's 100% safe, easy to access and provides a better return than standard bank deposit accounts. I wouldnt see inflation as a major issue - Mum doesnt need the money now and one could reasonably assume that it would not be held as savings for a sufficiently long time for inflation to have a major impact. The sole driving factor should be to act in Mum's best interest. It's difficult to see how taking greater risk with her money would add to her quality of life.
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