Can an elderly mother sell her house and give her son some/all of the money?

newan

Not sure if this is the right section for this.

An elderly lady me and my partener know wishes to give her son, who lives in germany, some money to help him through a difficult period in his life, he's 60+ years of age and has lived in germany for 40 years, the lady has always lived in uk. She is ready to go into sheltered accommodation and wants to sell her home and give her son as much of the money as she is allowed, her estate would be worth less than 325k, probably closer to 250k. Her pension will comfortably cover her rent in a sheltered flat and other living costs, plus any capital she keeps back for herself from the house sale. What she is worried about is if in the future she is put into a residential or nursing home will her son have to pay the fee's?? She is absolutely desperate to help her son have a comfortable life while she is still alive, and is completely confused by the whole thing.
Any advice would be appreciated as her health is suffering due to the worry of her situation.

elsien

She needs to consider deprivation of assets, in the event that she does need means-tested care.
http://www.ageuk.org.uk/home-and-care/care-homes/deprivation-of-assets-in-the-means-test-for-care-home-provision/


There isn't a one size fits all answer, but as the son would appear to be unlikely to be returning to this country, has she considered that she might be narrowing her options rather a lot even if she manages to give him the money legally.
What about her being able to have a comfortable life while she is still alive?

newan

Yes, it is difficult to cross examine her too much. My partner met her a few years ago and has become quite attached to the old girl, now we visit her regularly and see she is ok for everything, and to check on her. She has been stressed out for a while about her house and money.
19 years ago while her husband was still alive they were advised by a local solicitor to put their house in the possession of a trust so they could leave their son the house without paying loads of tax or something (excuse my lack of knowledge on the subject). She is the trustee and her son is the beneficiary as I understand it, also her cousin is another trustee(?). Apparently the son wouldn't get the money from the house until she died, but as her son is having some difficulties she really wants to see him financially comfortable while she is still alive. She is ready to sell up and go into, what I understand it to be, a private sheltered flat closer to the town centre. She has said her pension is enough to cover rent etc, and she would obviously keep a certain amount of money for herself from the house sale.
I understand there are ethics involved concerning residential/care home costs and don't wish to upset anyone on here but I said I would try and find out her options for her.
maybe if she could sell the house and give him half the money she might be happy with that.


Thanks for the link btw, I will have a read.

elsien

If the house is in trust, would she be allowed to sell it anyway? Sounds to me like she may need to double check the provisions and type of trust and how it was set up.

troubleinparadise

It is a pity that a lady of possibly 80+ is having to worry about supporting her son of 60+ who lives abroad.

The issue of her estate being worth less than the IHT threshold does mean that giving away her capital will not therefore be viewed as a means of avoiding IHT - but obviously does raise the issue that she might be deemed as deliberately depriving herself of assets that could fund her own care.

If she is selling up to go into sheltered accommodation, that suggests she is already needing an element of watchful care, and she should perhaps be worrying more about how she will support herself for what might be another 20 years. She may never need residential care; care in the home can keep people out of residential care, but in her case she would have to fund it. If she has given away her capital, which will show up in a financial assessment, she will reduce her choices for her own future.

Does the son realise how worried and confused she is? Perhaps he needs to reassure her that her welfare in her later years is more important than him having a comfortable life leaving her financially short or worried about not being able to afford care for herself.

Postscript: I posted not having seen the OP's post about the house being in trust. As Elsien says, she would need to take advice about the nature of the trust before taking any further action.

PasturesNew

It would depend on how much her pensions were, how much she'd given her son etc.

It's all about the ability to pay your own way. If the care fees weren't the most expensive and if her pensions were generous and if she kept enough of the house sale money to top up her pensions..... then it's easily possible that it could take 15-25 years to get through her money before needing help to pay the fees.

Needs a spreadsheet really and a "guess" at whether she'd need a care home ever, and how long she might live.

newan

Yes, we realise she would have to cancel the trust which her solicitor has said is not a problem, sorry should have mentioned that. I have suggested she needs to speak to her son more about it as I'm not entirely sure he knows the full story. I guess if she sold her house for 220k and kept 50k or 100k for herself then her sons portion of the money wouldn't be an issue. If after her money runs out the authority concerned chased her son for costs, then this what she is worried about happening.

elsien

What sort of health is she in? - if she's fit as a fiddle and likely to go on for years, giving the money away will be less of an issue than if she's got health issues where it can reasonably be foreseen that she'll need care at some point.


There are many people who never need to go into a care home, and policy at the moment is to keep people in their own homes for as long as possible with the use of assistive technology.
To be honest though, in the worst case scenario she should be less worried about her son being chased for money, and more concerned about the standards of a basic home paid for by social services, should it ever come to that. Money = choice. My grandmother's (poor quality home) cost £550 pw in the midlands, to give her an idea of how far her money might go. Although if she's self funding, she may still be able to claim other benefits/pensions to top it up.

newan

I have to say I'm really thankful for the advice given so far, you've certainly helped me with regards of how to advise her on the best course.

Her health isn't the best, she is 87 now and has a few problems including a recent cancer scare which I'm not sure is completely resolved. She still gets about, goes into town once a week and does as much as she can around the house, albeit with the help of a few friends and her cousin I mentioned earlier.
Tbh I'm not sure how much her son knows and am worried he might know very little about what she is thinking of doing.

dancingfairy

Depending on where in the country it is you could be looking at up to £900 a week for a private place in a nursing home. Obviously it depends on capital and a means test so it could be less but that is a rough guide at the moment. Also you would be looking at maybe £50/£100 a month on top which should cover toiletries, hair cuts, newspapers/magazines, clothes, day trips etc.
Based on that 50k may not be enough, 100k may be better.
People don't generally last more than a couple of years in care homes, in some cases it can literally be a few weeks.
Obviously this only covers the care home fees and doesn't consider the sheltered housing before that and paying for her daily living costs.
df
edit: she should also consider putting in place a power of attorney thing so that if she gets to a point where she can't manager her affairs the poa ( I think that's what it's called) is registered and whoever she'd nominated can take over the running of her finances and make decisions about her welfare. It can be set up now so that when needed it only needs to be registered, otherwise it will have to be done by family/friends at a later date and can be stressful at an already stressful time and can take a while, which if you have a care home breathing down your neck won't be much fun.

hunnie

Hello, I am in my sixty's and also want to release money from my home to help my three children (all married). I am looking at renting a flat (c£400 per mth) in a warden controlled block. This is affordable from my pensions, as you state this elderly lady's plan is.
I can't see how it would be deprivation of assets if she is needing to go into sheltered accommodation.
I can no longer manage the large garden and the bills will be reduced so perhaps it's similar for her, especially at 87yrs.


I didn't need power of attorney when managing my mum's affairs. I merely made everything joint and had no need for this. I will do the same with my daughter to make things easy for them.
Regards, Hunnie