Mrs B contacted us, as her mother had recently been admitted to a care home and she held Power of Attorney over her mother’s affairs.
Mrs B needed to generate additional income from the sale of her mother’s property to make up the shortfall between her pensions and the care home fees. Other than suffering from Alzheimer’s, Mrs B’s mother was in good physical shape so it was clear that a long term plan was needed – especially with the care home costs expected to rise each year at a rate faster than inflation.
We looked at a number of ways that the sale proceeds might be invested in order to meet the fees required in the longer term. One solution would have been simply to place all of the funds from the sale on deposit, where we calculated that there would be sufficient monies to cover the fees. However, whilst this would be a very safe approach, we agreed with Mrs B that it might be unnecessarily cautious.
We used our Lifestyle Financial Planning software to test various financial scenarios and concluded that with some sensible, longer term financial planning we could cover all of the care home costs and give the family some expectation of an inheritance in the future.
After some discussion, we settled on a “three way” strategy combining a high interest deposit account to cover shorter term needs, a plan providing a guaranteed level of lifetime payments to help meet the fees themselves and a lower risk, low volatility investment fund for the medium to longer term. By using this combined approach, Mrs B could relax in the knowledge that the cost of her mother’s care would be covered and there should be funds available to distribute to the family, in due course
In working closely with us, Mrs B is now confident that there is a suitable strategy in place to provide for her mother’s needs for the long term.
If you would like to know more about the ways in which we can assist you please contact Peter David or Nick Kacigeras on 01483 508580.