Sadly, unscrupulous companies are preying on these concerns by targeting vulnerable older people, in the hope of persuading them to invest in dubious schemes designed to reduce the value of their estates. Can you pass on your estate to avoid care home fees? How can you avoid being the victim of a scam?
We recently received a call from the son of a 78-year-old woman who had been contacted by a firm calling itself an "estate planning company", offering to protect her home from care home fees.
The caller explained that for £3,000 plus VAT and a £40 Land Registry fee, he could set up a discretionary trust for her. He would transfer ownership of her house to her two sons and they would allow her to live in the property under the trust. If she had to move into a care home, she would not be regarded as owning her own home and therefore would not be required to sell the property once her cash ran out to pay for the care fees.
Luckily her son had called us to see what we thought of the idea and we were able to explain the problems with such a scheme, the main one being that it is illegal to deprive yourself of assets to avoid care home fees. Transferring ownership of your house to family members during your lifetime will not necessarily achieve this.
As a rule of thumb, be wary of anyone who calls you at home out of the blue and wants to talk to you about making a Will or setting up a trust. If you are tempted by their low fees and their offer of discussing further in the comfort of your own home, check out their advice with a local solicitor before you enter into any arrangement with them.