Barclays Investments that Protect Money from Being Used for Nursing Care?

CelticStar

I have been helping my mother-in-law (with the help of this site) to decide where to save some money that she has. Anyway, yesterday she went to Barclays - which is where she has had her current account for years - to see if they had any accounts that would offer her a decent savings rate. We have chatted about this and I warned her that they almost certainly wouldn't have as good a rate as other accounts we have been looking at but she wanted to set her mind at rest that this was the case so I thought that it was best for her to see for herself.

While she was there they tried to sell her an investment that supposedly 'kept her money safe from being used if she ever needed nursing care because of the things (presumably shares even though she stipulated that she wasn't interested in shares) it is invested in'. I am not very well at the moment so couldn't go with her to the meeting and she wasn't given any literature about this account so I have no idea what is was called and can't find anything about in on the Barclays website. It was apparently a five-year investment/account, which was much longer term than she wanted anyway, and she would receive 'bonuses' during the investment term and an added rate of interest as she already has a Barclays current account.

This smells like some sort of share portfolio to me but has anyone heard of this investment and is it possible to put money in some sort of investment that can't be touched if you need nursing care? I just can't believe that this is possible!

Any help and/or advice gratefully received.

RayWolfe

What I don't understand is why one wouldn't want to use savings for nursing care! Don't we save for a rainy day? If you need nursing care the rainy day has arrived.
Or is it more about the children wanting their "inheritance"?

dunstonh

While she was there they tried to sell her an investment that supposedly 'kept her money safe from being used if she ever needed nursing care because of the things (presumably shares even though she stipulated that she wasn't interested in shares) it is invested in'.

That would be an investment bond. It doesnt contain shares. It is typically a unit linked investment (nowadays) where the investments can include cash, fixed interest funds, property and stocks and shares. There are some guaranteed options available with certain providers.

The investment bond must not be sold with that purpose in mind. It needs to be documented as chosen for another reason. Otherwise it fails the means test requirements. If it is chosen for investment purposes such as tax efficiency, lower cost etc then if local authority care is required then it will be exempt from the means test.

All that said, going to a bank for financial advice is the most expensive way to get advice and typically you end up seeing someone with lower experience and lower qualifications. Banks are the natural training ground for new advisers nowadays. They operate on a sales force basis and that is not the environment ot seek proper financial advice. As reflected by complaints stats where banks account for the majority of all complaints going to the FOS.

EdInvestor

dunstonh wrote: »

That would be an investment bond. It doesnt contain shares. It is typically a unit linked investment (nowadays) where the investments can include cash, fixed interest funds, property and stocks and shares.

Make up your mind.;)

CelticStar

RayWolfe wrote: »

What I don't understand is why one wouldn't want to use savings for nursing care! Don't we save for a rainy day? If you need nursing care the rainy day has arrived.
Or is it more about the children wanting their "inheritance"?

Where in my post does it imply that my MIL has not made any provision for her nursing care? I suggest you read posts more carefully before making nonsensical statements.

CelticStar

dunstonh wrote: »

That would be an investment bond. It doesnt contain shares. It is typically a unit linked investment (nowadays) where the investments can include cash, fixed interest funds, property and stocks and shares. There are some guaranteed options available with certain providers.

The investment bond must not be sold with that purpose in mind. It needs to be documented as chosen for another reason. Otherwise it fails the means test requirements. If it is chosen for investment purposes such as tax efficiency, lower cost etc then if local authority care is required then it will be exempt from the means test.

All that said, going to a bank for financial advice is the most expensive way to get advice and typically you end up seeing someone with lower experience and lower qualifications. Banks are the natural training ground for new advisers nowadays. They operate on a sales force basis and that is not the environment ot seek proper financial advice. As reflected by complaints stats where banks account for the majority of all complaints going to the FOS.

Thank you very much for this detailed post, I feel a lot better informed now. I totally agree with your comment about banks (and I particularly dislike Barclays) but I can only advise my MIL in this instance. I am concerned that Barclays have clearly tried to persuade her to take out a product that she doesn't need.

Thank you again.
CelticStar