Savings life/death dilemma

Aled_Mann

Hi guys, I've been a big fan of MSE for some time now but this is my first post so be gentle!

I have a query on behalf of my father, who at the moment is by my mothers bedside at the hospital cancer ward.

5 years ago my grandfather died and he left his estate to my grandmother, who in turn gave the money to her daughter (my mother) because she (my grandmother) didn't need it.

My mother tied this money into a 5 year high interest account. The money was released November 2nd 2009.

Unfortunately, over the past 2 years my mother has developed cancer and is now non compus mentus for most of the day due to morphine and the effects of her illness.

My father approached Halifax yesterday to discuss this with them but they told him that they could only discuss this account with my mother. Clearly this is not going to be possible.

His concerns are:

1) How does he solve this matter if the bank with only deal with my mother?
2) Is the money safe?
3) What happens to the money whilst my mother is alive?
4) What happens to the money in the event of my mothers death?

Any advice you can give would be a load off his mind I'm sure. So thank you in advance.

isofa

Firstly I'm sorry to hear of such a awful situation, unfortunately I know exactly what you are going through.

Your Father (or you) needs to get power of attorney: http://www.direct.gov.uk/en/Pensionsandretirementplanning/HomeAndCommunity/Carers/DG_10026855 however the law changed last year, so the process isn't as straightforward as before, so I'm sure someone au-fait with the new rules will be able to advise, a good solicitor will be able to organise the process.

Essentially with PoA the person with it (you or your father), can manage your Mother's affairs legally.

1. As above
2. Yes, (although a very minor point if it's over 50K there is the potential risk if it's all with one institution and that institution goes bankrupt - you are only protected to 50K per person [or 100K joint] via the FSCS)
3. Depends where the money is now, if it's now in a low rate instant access account (usual when fixed rates mature), it'll stay there until either your mother, or the power of attorney holder can move it.
4. It depends on her will, if it's all left to you father, he'll inherit it all etc.

If your Grandmother was to pass away before 7 years have passed since the money was gifted to your Mother there could be IHT issues too, if her estate is over the IHT threshold etc. http://www.direct.gov.uk/en/MoneyTaxAndBenefits/Taxes/BeginnersGuideToTax/InheritanceTaxEstatesAndTrusts/DG_179336

Aled_Mann

Thank you very much for your quick reply. I knew this forum was the right place to be!

Another question, how can you legitimately get PoA if the patient is unaware of what's going on?

isofa

I may be wrong, but since the law changed, you can but it has to be authorised by the Court of Protection: http://www.publicguardian.gov.uk/decisions/decisions.htm

It would be better if at all possible, to wait until you Mother can partially reduce her meds to have a solicitor visit you all together and get him to draw it up with your Mother's permission and signature to appoint a Property and Affairs Lasting Power of Attorney. It would be wise for her to ensure her Will is up to date too, and does everything she wishes.

Aled_Mann

Unfortunately she could pass away any day (or hour) now. She has family by her side 24/7 so getting a solicitor there isn't going to be possible.

She can't even hold a glass of water so signing anything is not going to be possible either.

isofa

Then providing she has a Will which leaves everything as she wanted, or at least all to your father, there is little point in applying for PoA as it'll take a long time. When everything passes to your father, he'll be able to close her accounts and move money into his name, via the correct documentation anyway, which will be the Grant of Probate: http://www.direct.gov.uk/en/Governmentcitizensandrights/Death/Preparation/DG_10029799 Although some organisations will close accounts on seeing a Death Cert, but technically they should all see the GoP.

zzzLazyDaisy

I am so sorry to hear about your mum.

There is absolutely no point in going down the PoA route as it is complicated and takes time and the PoA lapses on death anyway.

After your mother has passed away, her estate will pass under her will (or if she has not left a will, under the intestacy rules) and all her assets will be called in and distributed accordingly, including this money. It will then be up to whoever inherits to invest or save the money as they see fit.

I know it is tempting to try and keep yourself busy, and organise things, but can I suggest that you forget about this stuff for the moment and concentrate on your mum in her last few days? This isn't a criticism, honestly, so please don't be offended, it is just that I remember how I felt during my mum's last few days - I was desperate to do something, just to feel in control, but what will be, will be, and this money will wait for a few days more.

Hugs

xxx

Aled_Mann

Thanks for all your help guys!

I think the estate is over the inheritance tax threshold though. So initially the plan was she would give it as a gift to my father (which it tax free). However, in the state she's in there's no way she can talk to the bank.