Tenants in Common, Wills with Trusts and Powers of Attorney

goakes

I have just recently retired from work and in my late 50s. I have been in discussions with a financial advisor who recommends for I and my family (wife and two children over 18) to consider having a Tenants in Common agreement, have the Wills with trusts and to have Powers of Attorney. I do understand the perceived benefits by doing this. Has anyone else had any similar conversations and if the case how much would I be expected to pay for this service? I have been quoted close to £2,000!

Savvy_Sue

If the intention of the trusts is to put the house out of reach of the local authority should you need either help with care at home, or residential care, it won't work. 

If you don't have wills, go and see a proper solicitor. Phone around and get quotes. That and PofA shouldn't cost that much, and you could even do the PofA yourselves. 

Mojisola

The benefit of owning your home as tenants in common is that the first to die can leave their half of the property to someone other than the spouse.  It's normal to give the survivor the right to continue to live in the house and to use the value of the property to move to another one. 

The beneficiaries don't actually get their inheritance until the property is no longer needed by the survivor.  This may be because they go into a care home.  This gives them half the value of the property to pay for their care.

It won't count as deprivation of capital because it's not the person going into care who has given capital away.

As Sue said - putting the whole house into a trust to try to avoid paying for care would be considered deliberate deprivation and would leave the person needing care with no choice about what care home they go into.

Keep_pedalling

I don’t think DOA is applicable here, at the moment both spouses own half a house, and after converting to TiC they will still own half a house each. Also the main reason people do this at the OPs age if to protect assets in the case of the surviving spouse remarrying.

£2000 is expensive. The LPAs can be be done yourself at £45 each. Wills with LTI trusts are fairly straightforward but they should be drawn up by a solicitor.

Savvy_Sue

Keep_pedalling said:

I don’t think DOA is applicable here, at the moment both spouses own half a house, and after converting to TiC they will still own half a house each. Also the main reason people do this at the OPs age if to protect assets in the case of the surviving spouse remarrying.

That's fair enough, it does depend what is being suggested, but I still maintain that if it's being sold as something which will protect the assets if care is needed, it needs careful examination. 

Keep_pedalling said:

£2000 is expensive. The LPAs can be be done yourself at £45 each. Wills with LTI trusts are fairly straightforward but they should be drawn up by a solicitor.

Absolutely, and as this advice came from a financial adviser, and the OP is being quoted that sum of money, the first question is "who's writing these wills?" and the second is "what would a proper solicitor approached independently charge for this?" 

missile

Seems like poor and expensive "advice" from a crook in a suit

TELLIT01

Mojisola said:

As Sue said - putting the whole house into a trust to try to avoid paying for care would be considered deliberate deprivation and would leave the person needing care with no choice about what care home they go into.

It's not that clear cut.  I don't know the full detail, but the property of a friend's mother had been put into trust years prior to her going into care but the council still tried to put some form of control on the property.  They even went as far as getting all the locks changed and refusing the daughter access to collect her own property from the house.  The property was then burgled and the council tried then to disclaim any responsibility despite them being the only ones able to access the property.  The case went to court and the council lost on all counts and the property was returned to the daughter.  The council also had to pick up a hefty legal bill.

missile

Please be careful and get good legal advice, or you might end up like this > Discretionary Will Trust Disaster — MoneySavingExpert Forum

Zanderman

Just to add to what's been said already, this shouldn't cost £2k, probably isn't the right thing to do anyway (and may be pointless) and you should get advice on such matters from a solicitor, not a financial advisor. 

LPA can be done DIY for under £50.  As can Tenants in Common - you can get a form from the Land Registry.  But be sure that is what you want to do.  As for wills (or houses) in trust etc, that's a whole minefield of ifs and buts.

Be sure to talk to a reputable solicitor, there are some out there who will insist putting a house in trust etc is the best thing, when actually it very probably isn't.