Selling your home to go into care, how to avoid it?

margaretclare

Ted_Hutchinson wrote:

I do think that everyone considering equity release should take INDEPENDENT financial advice before signing up.

With interest rates almost bound to rise the compounding effect of interest on interest could mean, if people don't die when the actuaries expect, that there is little or nothing at all left for the heirs.

I'm not suggesting that it is necessary or desirable for everyone to leave money for their grandchildren. I do think that if you've earned the money you should enjoy it, however simply letting the banks and building societies have the lions share doesn't appeal to me either.

Well, the reason that we did it was purely and simply to pay off the original mortgage. We'd have been paying £250 or so a month (or more, if interest rates rise) for another 15 years. Therefore we do have the extra £250 a month to do with as we please, as your last paragraph says.

We're planning an expensive (but ultimately cost-saving and planet-saving) project for this autumn - a replacement combination condensing gas boiler and updating of our heating system. This will actually save us in gas bills so yes, we ARE doing things for our own convenience, comfort and enjoyment. Last autumn our project was the wildlife pond which cost us approx the same as another week's holiday, but it really it providing us with long-term and day-to-day enjoyment, pleasure and satisfaction.

Aunty Margaret

SilverSurfer_4

Insurance is a system where a large number of people suffer a small penalty (premiums) in order to benefit a small number who are unfortunate enough to suffer a major disaster.
You can insure against not living the average life span (life insurance).
You can insure aginst living longer than the average (annuity).
Never assume you are 'average', unless you have 2.7 children !!:-)
You should only insure against an event that you would find disasterous.
It is up to you to decide against which event you wish to protect yourself and your family.

Ted_Hutchinson

SilverSurfer wrote:

Never assume you are 'average', unless you have 2.7 children !!:-)

The current average is 1.74 children which is somewhat less than the replacement rate of 2.1 children. I'm not sure why you are regarding the average as 2.7?

eribar

On the subject of being able to pass your home on to your family a useful tip is to change ownership of the house from "joint" to "common". You then each own half of the house. You each make wills leaving your half to your children with a proviso that when one of you dies the survivor has a life interest in that share permitting them to live there indefinitely. Should the surviving partner have to go into a home only the value of their share is taken into account in assessing their ability to pay for care and as half the house is now owned by a trust on behalf of others the likelihood of finding a willing buyer for the other share is remote so the survivor's share value is going to be very little if anything. This does not work if your joint assets are in excess of the inheritance tax threshold and you need to take professional advice. (from Money Mail Jan 19 2005)