Leonard Kasler & Company
Preparing for Infirm Old Age
(20 Things to Know)
1. The Welfare State was set up with the misleading slogan that, (if you paid your taxes and National Insurance) you would be cared for "from cradle to grave".
2. People worry about paying Inheritance Tax but consider this - the Inland Revenue take 40% tax on assets over £223,000 (1998/9). You are dead.
3. And this - if you are taken into care, the Local Authority can take 100% of your assets. You are still alive !
4. The National Health Service may be good at dealing with "acute services" usually in hospital "free at the point of delivery"
5. No longer do you stay in hospital for recuperation. As soon as your condition has stabilised, you are discharged.
6. It is said that some decisions to discharge are made too early and are due to financial pressures, rather than on medical grounds. Where do you go ?
7. Home ? To be looked after by caring relatives, who are prepared to sacrifice their earning opportunities, privacy and social life.
8. Private Nursing Home ? If you can afford the £200-1,000 per week, depending on location and amenities provided.
9. To the Local Authority for help ? They can provide help in your home or at day centres or can provide or buy-in beds from the private sector.
10. The Local Authority can provide a free assessment of your needs, but target their resources, where need is greatest.
11. If you need non-residential services, the Local Authority cannot charge more than it is reasonably practical to pay, but charging procedures varies from one Local Authority to another.
12. For non-residential services, there is a Means Test. If you have more than £16,000 capital (which can, in certain circumstances, include your home) you will pay the standard fee.
13. When your capital is reduced below £16,000, other considerations apply. These are too involved for this short note but it is not good news e.g. a personal weekly expenses allowance of £14.45 (1998/9) for clothing, haircuts, toiletries, treats and presents for relatives and friends!
14. The Local Authority can only assess the means of the person requiring care, not those of a spouse or partner.
15. Since 1948, spouses (not co-habitees) have always been liable to maintain each other. In the event of non- co-operation, the Local Authority can without formality and without your knowledge, put a charge on your home.
16. It is not necessarily effective (or desirable) simply to give away assets and let time pass. The Local Authority will argue that you intentionally deprived yourself of assets and that the gift should be ignored.
17. Local Authorities, in this area of work, act in their own financial interests and are not out to advise you
18. You should take advice on the detailed rules as they apply to your present financial position and circumstances.
19. Whatever age you are, you should ideally plan for your old age. If you are over 50 and even in good health, you might appreciate a full "wealth check" to encompass
19.1. Will
19.2. IHT planning
19.3. Enduring Powers of Attorney
19.4. Funeral Planning
19.5. Equalising Estates
as well as the issues raised in this Newsletter.
20. Often, consideration has to be given to former spouses, children by first marriages, adopted or illegitimate children, family disputes. It is not sufficient to deal with the above areas in isolation.
Michael Breeze
Leoanrd Kasler & Company
Sunday, 13. October 2002