Living Together: Cohabitation Agreements & Declarations of Trust
A family lawyer’s day, more often than not, involves dealing with the ending of relationships.
If you, or a loved one, is facing the prospect of a permanent stay in full-time residential care, there will be an expectation that it will need to be paid for. The value of your assets will be assessed, which may include the value of your home.
Planning ahead can protect your assets
Your home may not be taken into account for the cost of care whilst your spouse, partner, older relative, disabled relative, or child (under 18) still lives there. However, in other cases, there is no option but to include it in the sums. Planning ahead can help protect your assets and ensure the best solution is decided ahead of time.
We caution against giving away your home or other assets for all sorts of reasons. If, however, you own your home jointly with someone else, such as your spouse or partner, there may be another option for you, which is to create a life interest trust in your Will. This Trust only takes effect after one of you dies and will protect that share of your home if the survivor needs permanent residential care.
Here is one basic example of a 'Life Interest Property Trust' with Barbie and Ken.
In addition to mitigating potential care home fees the Trust can protect assets should the survivor remarry. If instead Ken stayed in Beach Villa and met a new partner, Sindy, he would not be able to gift Barbie’s share of Beach Villa to Sindy in his Will; that would still pass to Millie and Paul on Ken’s death.
A basic example in this case, but Trusts don't need to be daunting. The Prettys team can guide you through the practicalities in easy-to-understand terminology.
Contact the Prettys team: T:01473 232121 | E: enquiry@prettys.co.uk.