Welcome to this week's video about "How to protect your home and your inheritance from care home fees" where we will examine the current state of the care home fees market in the UK, the problems that countless families face and the solutions. Welcome back to the @Economese channel where together we will learn the language of money and wealth. We are dedicated to mastering money and making financial wisdom available to all. #financialeducation #financialfreedom #financialplanning #retirement Are you worried about losing your hard-earned home and savings to skyrocketing care home fees? You're not alone. With care costs in the UK averaging in excess of £1,000 per week—and rising—this is a reality for many families. Shockingly, over 50% of people may need care at some point in their lives, making it vital to understand how to protect your assets and secure your family's financial future. Worst still, 37% of people are already having to fund their care home fees in full! The Care Fee Cap: Explained and Scrapped The £86,000 care fee cap was introduced as a safety net for families but has since been abolished, leaving many vulnerable to the full costs of care. Without this cap, navigating the complex world of care funding becomes even more crucial to safeguarding your inheritance. The Local Authority Means-Tested Assessment Local authorities conduct a means-tested assessment to determine who pays for care. This involves evaluating both capital (e.g., property, savings) and income (e.g., pensions). If your assets exceed £23,250 in England, you'll be responsible for paying the full costs of care. Even if your assets are lower, you'll still need to contribute from your income and savings. Understanding these thresholds is essential to ensure you're not overpaying. The Myth of the 7-Year Rule in Care Fee Planning A common misconception is that the 7-year inheritance tax rule applies to protecting your home and assets from care fees. Unfortunately, it doesn’t. If you deliberately transfer assets to avoid care costs—known as deprivation of assets—local authorities can legally recover these assets to fund your care. Planning ahead with the right strategies is crucial. Effective Solutions to Protect Your Assets 1. Set Up a Trust A trust is a powerful tool to shield your home and savings from care costs. By transferring assets into a trust, they no longer count as part of your estate for means-testing purposes. However, this must be done properly to avoid legal complications. 2. Lasting Power of Attorney (LPA) An LPA ensures your financial and health decisions are managed by someone you trust, should you lose capacity. This prevents financial exploitation and guarantees your care arrangements align with your wishes. 3. Tenants in Common Switching to tenants in common ownership for your property can protect your share of the home. Upon your death, your portion can be passed directly to your heirs, bypassing care fee liabilities. Plan Today, Secure Tomorrow Proactively addressing these challenges can save your family from financial hardship. Whether it's setting up trusts, revising property ownership, or implementing a solid estate plan, these strategies ensure your legacy is preserved. Chapters 00:00 Introduction. 02:14 Scale of the care home fees market. 05:13 Local authority means test assessment. 08:03 How can I protect my home and my inheritance? 08:14 Setting up a Trust. 09:37 What is "Tenants in Common?" 10:11 What is the 7 Year Rule? 10:32 What is a Depravation of Assets? #carehomes #ukcarecosts #estateplanning #trusts #powerofattorney #financialsecurity