An increasing number of people are worried about the possibility of needing care in the future and the financial impact that may have upon their assets. Protective Property Trusts in your Will can enable a couple to save part of their property to pass onto their family. These types of Wills are also sometimes called Property Trust Wills.
What is a Property Trust Will?
A property trust is a type of legal structure that can be included as part of your Will and is designed to protect your share of jointly owned property from being included in financial assessments that are carried out to determine how much you should contribute to long-term care fees. The structure can also be useful should you be worried that your spouse might re-marry in the future by protecting your share of the property for your family.
A property trust will covers a share of a jointly-owned property to ensure that a surviving spouse or partner can still benefit from their deceased partner’s share in the property even when they are gone. Bottom of FormShould the survivor have to go into long-term care, their deceased spouse’s share will be protected – and can be passed onto family members upon their death.
Most couples when making a Will, leave their assets directly to their partner. Should the partner require care, this can mean that there are less assets to pass onto the family after their death.
For this reason, Property Will Trusts can hold assets on behalf of the partner to guard against deductions made due to care costs.
How Does It Work?
The best way to explain how Property Trust Wills work is through an example:-
Let’s say Mr and Mrs Marr jointly own their home. They want to ensure that their respective shares will be passed to their two children when they pass away. They want peace of mind that if the survivor of them needs care, at least half the property can be passed to their two children.
If Mr Marr dies before his wife, his half share in the property will go into the Property Trust set up in his Will – with the remainder of his estate left to Mrs Marr. She then has the right to occupy the property or move house if she wishes. If she requires long-term care in the future, her Husband’s share of the property remains in trust and cannot be taken into account during any financial assessments to determine what she will need pay towards her care.
In short, 50% of the value of the property cannot be taken and used to pay for her care fees.
This type of trust covers every eventuality. Even if Mr and Mrs Marr’s children divorce, predecease them or declare bankruptcy, the surviving spouse still retains occupancy and their share in the property is fully protected. Upon Mrs Marr’s death, the half share of the property is transferred to her two children, even if Mrs Marr has used all her assets to pay for care.
What Does This Cost?
Depending on your circumstances, this type of arrangement can cost from £400 – £525 + VAT.
Four Oaks Legal Services can assist if you feel a Property Trust Will might suit your circumstances. Please contact us on 0121 308 8231.