Maurice - Example Scenario One

Our aim is to preserve your capital!

Maurice was a widower, aged 89. He suffered from various medical problems which were relatively typical for his age. He needed help with toileting and with the stairs, so following a short stay in hospital it was decided that he needed residential care. His daughter Penny assumed the responsibility for looking after her Father’s financial affairs.  

Following the sale of Maurice’s house, he had £190,000 to help pay the care home fees. He also had separate savings of around £20,000 from which he received interest.

Penny found a delightful care home and after a relatively short period he came to like his new environment.

When we calculated Maurice’s total income (state pension, occupational pension and attendance allowance), he had income of around £18,000 per annum. The residential care home fees were £800 per week (£41,600 per annum). This was an expensive care home, but the family wanted him to have the best possible care – Maurice had been very careful with his money so Penny knew he would be disappointed to think that all of his savings were spent on care home fees - this is where Beckworth Financial Services Ltd helped!  

In summary, his annual income was £18,000, his care home fees were £41,600, therefore the income “shortfall” was £23,600 per annum.   

Penny had various options and decided to purchase an immediate needs annuity. The annuity was purchased for only £20,000 and this produced an income of £6,988 each year (payable monthly). With the remainder of the capital, we invested into traditional investments from which we took withdrawals (“income”) of £12,750 per year.   

Whilst there was still an income shortfall, after our involvement it was around £4,000 per annum, rather than £23,600.  

In summary, the majority of Maurice’s capital should be preserved and passed to his family as Maurice wanted. There are many things that can be done depending on the client’s circumstances – we will tailor a portfolio to protect as much capital as possible.