People in their forties with young families often face additional concerns about the welfare and care of their ageing parents. As mental capacity issues and physical frailty become more prevalent amongst those in their late seventies onwards, Mum and Dad – who have hitherto lived an independent, active and settled life in retirement – can begin to be a source of worry.
Often the first priority is to look at what care needs to be put in place – whether that can be at home or in a care home – and how to find the right provider. Age UK’s website can be a good first port of call, containing information not only about care, but also about what your parents may be entitled to in terms of funding. There are also specialist private consultancies who advise on care homes, and these can be an effective way of understanding the options specifically tailored to your parents’ needs.
The impact of Covid-19 on both care homes and those providing care in people’s homes has limited, or at least changed, the options available to many families at the present time. Again, Age UK and other charity websites, as well as private consultancies, remain a good starting point in getting the information you need, even if it means nothing can be actioned at the moment.
Funding care is often the main source of worry. A particular concern is often whether the family home is involved. If care is to be provided at home, equity release type arrangements (the most common type being a lifetime mortgage) may be appropriate, but this is a complex area and should be considered carefully with specialist advice. Other options involving the family home could be considered as well, for example deferred payment schemes. If liquid funds are available there are various financial and investment options – including annuities – to review. Again, it is important to take independent financial advice to ensure you are making the right choice for your situation.
Wills and tax planning
On the legal side, your parents will want to make sure that their Wills are up-to-date and look at getting advice as to whether any estate planning can be done to save inheritance tax. That may be through making gifts or investing in assets which attract inheritance tax reliefs or exemptions. It is important to understand the options and put the necessary plans in place for the future, whatever those circumstances may be.
Powers of Attorney
It is also sensible to ask your parents whether they have a Lasting Power of Attorney (LPA) in place so that decisions can be made in relation to both finance, and health and welfare should they lose capacity to decide themselves. The forms are available online, where you will also find guidance on how to complete them.
While the LPA form is relatively straightforward to complete, specialist advice about LPAs can be very helpful as there are a number of beneficial additional provisions which should be considered – for example, in relation to the management of investments.
The Office of the Public Guardian is responsible for registering LPAs and it has set out additional guidance in the wake of the COVID-19 (‘coronavirus’) outbreak, including issues around signing and witnessing the LPA.
Very often family members face a different set of challenges when they are concerned that their parents have diminishing mental capacity or indeed have already lost capacity. It is important to keep in mind that capacity to take any actions – including legal ones – is decision-specific. It may be that a capacity assessment carried out by a medical practitioner is needed (for example, assessing capacity to make a Will). While not easy, it is sensible to have a conversation with your parents early on to see if they are happy to have this kind of assessment. If, sadly, capacity has already been lost then there are still ways to carry out estate planning (including Wills) through applications to the Court of Protection.
In each situation, your circumstances will be unique but it is always best to seek legal advice as soon as possible to put necessary arrangements in place. Planning for the future is not always easy, but once you have taken those steps both you and your parents can rest assured that the next step will be as painless as possible. For more specific advice on how to make a Will, or tax and estate planning, please get in touch.