How to reduce Savings for IHT?

Keep_pedalling

Downsizing to get more of your wealth into liquid assets would make IHT planning far more simple. 

xylophone

Thanks....seems a little unfair that I can't spend my money on them but it is what it is.

What makes you say this?

Do you want to pay the children's school fees? Then my suggestions offer possibilities?

xylophone

 thought about gifting a % of our home to my son.  However, he also wants to buy his own home 
My health has deteriorated in the past 2 years so I'm mainly at home now - my son looks after me and my wife.

It seems that your son has chosen to live at home with you for much of  his adult life and is now (to a certain degree) a carer - is it likely that if your health deteriorates/you predecease your wife that he would  move out, leaving his mother to cope alone?

It might be an idea to make him a substantial gift now and to  set up the accounts to pay/part pay your grandchildren's school fees.

Do you and your wife own your  home as joint tenants or as tenants-in- common?

Marcon

Keep_pedalling said:

Downsizing to get more of your wealth into liquid assets would make IHT planning far more simple. 

It could make it more complicated in terms of working out the downsizing addition in relation to the residence nil rate band.

Keep_pedalling

Marcon said:

Keep_pedalling said:

Downsizing to get more of your wealth into liquid assets would make IHT planning far more simple. 

It could make it more complicated in terms of working out the downsizing addition in relation to the residence nil rate band.

As the exiting house is worth £1M the OP would have to seriously downsize to get a house valued below the joint RNRBs. Even if they did it would not effect the amount that can be claimed as downsizing, is allowable under the current rules. They could even sell up and move in with a family member and still claim the whole lot.

Larry12

Thanks for the advice.
Yes my son has looked after us for many years, he doesn't intend to leave us but would like to buy a home in under his own name very close by.  We may or may not live with him - that hasn't been decided.  We know if anything was to happen to either of us that both our sons want us to live with them.  We don't intend to sell our home.
Having reflected on the advice here, I believe it makes sense to make a substantial gift now.
I've also read a few articles today that IHT rules may change with the budget this year, so I shouldn't necessarilly focus on IHT for now but instead look at the benefits of giving the children something to enjoy.