Life Interest Wills Newcastle upon Tyne
How can I protect my house from care fees?
Most people know why they should have a Will, however, they don’t know about the different types of Will and why they matter.
Most couples have what is called a “Mirror Will.” This means that when one of them passes away their other half inherits everything. It probably has a paragraph that looks a little bit like this:
“I devise and bequeath the residue of my real and personal estate whatsoever and wheresoever to my HUSBAND/WIFE …”
What couples don’t realise is that the consequences of having a Mirror Will can be catastrophic. This is because once one partner passes away the other becomes the sole owner of their property. This is when the problems start.
Let’s think about the following scenarios:
1. Your spouse has passed away and you are now the sole owner of your property. Unfortunately, your health starts to fail, and you can no longer live alone, so you move into a care home. The local authority can see that your assets total more than £23,250 so you must fund your own care.
You live for a further 5 years. You are paying £1,000 per week for your care. So you have spent a total of £260,000 paying for your care. Your family home and everything you and your spouse have worked hard for has been swallowed in care fees. All that is left is £14,250. After paying for your funeral and legal fees, your children are left very little in inheritance.
2. Your spouse has passed away and you are now the sole owner of your property. You meet a new partner and decide to get married! You do not realise that marriage revokes a Will, so you do not update your current Will or you do make a new Will but you make a new Mirror Will leaving everything to your new spouse.
You pass away, your family home and everything you have worked hard for is left to your new spouse. They now own your home. Your new spouse has a family of their own and their Will says that their estate is left to their children. Your children receive nothing. There is a way you can stop this and all that is required is a change of Will.
How a Life Interest Will can help
The idea behind a Property Protection Will is simple. Instead of leaving your half of your property to your spouse you leave it into a Trust. This means that your half of the property is protected for the people you choose, probably your children.
The Trustees can be your family members and your spouse so there is no interference from third parties.
Your spouse remains in control of the property as they are what is called the “life tenant.” This means that they can live in the house for as long as they like. They can even sell up and use the full value of the property to move.
The property trust comes to an end when you have both passed away. Your home then passes to the people you have nominated in your Will.
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