Knife in the back for pensioners..

quarky · May 2017

Or is it? Is it really fair that as people get older, they can pass on their £500,000 house to their kids and expect the state to pick up the cost of their care? I must admit, that doesn't seem right to me.

http://www.msn.com/en-gb/news/uknews/tories-to-cut-winter-fuel-payments-for-wealthiest-pensioners-as-they-launch-manifesto/ar-BBBfr2Z?li=AAmiR2Z&ocid=spartanntp

ThePrettyDamned · May 2017

Depends. If you're elderly and you need daily care for dementia or mobility issues, you can quickly burn through tens of thousands of pounds. If you are lucky (?) enough to make it past 100 and your family can't help...

I think it's a good idea, but if someone is running out of money then I suppose they could be re-means tested.

fretmeister · May 2017

They have paid National Insurance for 40+ years at that point. So they have paid for that care.

They shouldn't be paying twice.

They should also have transferred ownership of the house to the kids by then. If death occurs more than 7 years from the date of the gift there won't be any inheritance tax on it.

ThePrettyDamned · May 2017

fretmeister said:

They have paid National Insurance for 40+ years at that point. So they have paid for that care.

They shouldn't be paying twice.

They should also have transferred ownership of the house to the kids by then. If death occurs more than 7 years from the date of the gift there won't be any inheritance tax on it.

I agree, but that doesn't necessarily happen. There are elderly folk here who live alone or as a couple in three or four bedroom houses... It's created a vacuum of children - our primary school has gone from year 1-6 plus reception, to just two classes - reception, 1, 2 and 3, and a second class for year 3, 4, 5 and 6.

Fretwired · May 2017

quarky said:

Or is it? Is it really fair that as people get older, they can pass on their £500,000 house to their kids and expect the state to pick up the cost of their care? I must admit, that doesn't seem right to me.

http://www.msn.com/en-gb/news/uknews/tories-to-cut-winter-fuel-payments-for-wealthiest-pensioners-as-they-launch-manifesto/ar-BBBfr2Z?li=AAmiR2Z&ocid=spartanntp

I agree with you and so does my dad. He is 90 and his house is worth a lot of money and he thinks he should use the equity to fund his care home (should he need one). I'll be retiring soon and I think the same way. I think its fair if you are old and have substantial assets.

A lot of my mums friends have sold their houses and use the money to go into retirement schemes - you get your own flat plus care as and when you need it that you pay for .. seems sensible to me.

Myranda · May 2017

Let's not forget that this already happens if their house is worth more that £23500 (ish - I'm on my phone so don't fancy going back and forth to check)... A hole in the ground in scunthorpe would be worth more than that.

Granted currently being cared for at home only counts savings... Only a care home counts type home value... But still the numbers as they stand are ludicrous.

Under current rules they could be leaving less than 24000 to relatives

RandallFlagg · May 2017

Don't you have to be careful of how to you transfer the ownership of the house? I haven't researched but my Mum seems to think they can still come after the house value for care costs even if transferred to children?

fretmeister · May 2017

RandallFlagg said:

Don't you have to be careful of how to you transfer the ownership of the house? I haven't researched but my Mum seems to think they can still come after the house value for care costs even if transferred to children?

Yes.
Timing is everything.

Jalapeno · May 2017

quarky said:

Or is it? Is it really fair that as people get older, they can pass on their £500,000 house to their kids and expect the state to pick up the cost of their care? I must admit, that doesn't seem right to me.

http://www.msn.com/en-gb/news/uknews/tories-to-cut-winter-fuel-payments-for-wealthiest-pensioners-as-they-launch-manifesto/ar-BBBfr2Z?li=AAmiR2Z&ocid=spartanntp

Just to challenge that - is it fair if you live with a parent in the family home as a carer that you lose your home due to care costs of your parent (albeit care at home or when they have to go to residential care) ?

Fretwired · May 2017

RandallFlagg said:

Don't you have to be careful of how to you transfer the ownership of the house? I haven't researched but my Mum seems to think they can still come after the house value for care costs even if transferred to children?

Your mum is correct.

Ossyrocks · May 2017

RandallFlagg said:

Don't you have to be careful of how to you transfer the ownership of the house? I haven't researched but my Mum seems to think they can still come after the house value for care costs even if transferred to children?

I've just been through all of this with my Mum, she is now in care, as of this January.

Anything over approx £23000 in assets (cash, investments and property) is basically used to pay for care. Even when less than £23000, anything above £14250 is accounted for and any contribution by the County Council is reduced.

So basically, she has to get down to £14250 before they stop taking her money (cash, investments, property).

Regardless of all the above, they still take ALL of her pensions and leave her with £25 a week spending money. It's a bit harsh in my opinion.

The care home she is in is the most reasonable I have found. Some of them are horrible and cost the earth. Even so, the cost of her care is £2400 / month.

The assessors go back years through bank accounts and records to make sure no-one has tried to divert funds elsewhere.

If a house is to be transferred to children, it has to be done 7 years before there is a requirement for care, which will involve some extreme advanced planning. If you are thinking of doing this, do it now!

Rob.

Fretwired · May 2017

Ossyrocks said:

RandallFlagg said:

Don't you have to be careful of how to you transfer the ownership of the house? I haven't researched but my Mum seems to think they can still come after the house value for care costs even if transferred to children?

I've just been through all of this with my Mum, she is now in care, as of this January.

Anything over approx £23000 in assets (cash, investments and property) is basically used to pay for care. Even when less than £23000, anything above £14250 is accounted for and any contribution by the County Council is reduced.

So basically, she has to get down to £14250 before they stop taking her money (cash, investments, property).

Regardless of all the above, they still take ALL of her pensions and leave her with £25 a week spending money. It's a bit harsh in my opinion.

The care home she is in is the most reasonable I have found. Some of them are horrible and cost the earth. Even so, the cost of her care is £2400 / month.

The assessors go back years through bank accounts and records to make sure no-one has tried to divert funds elsewhere.

If a house is to be transferred to children, it has to be done 7 years before there is a requirement for care, which will involve some extreme advanced planning. If you are thinking of doing this, do it now!

Rob.

There's a limit to how much you can gift though - I thought it was about £45K per annum tax free. If you gift a house it may be liable to IT.

ThePrettyDamned · May 2017

Fucking hell, sounds complicated.

fretmeister · May 2017

Fretwired said:

Ossyrocks said:

RandallFlagg said:

Don't you have to be careful of how to you transfer the ownership of the house? I haven't researched but my Mum seems to think they can still come after the house value for care costs even if transferred to children?

I've just been through all of this with my Mum, she is now in care, as of this January.

Anything over approx £23000 in assets (cash, investments and property) is basically used to pay for care. Even when less than £23000, anything above £14250 is accounted for and any contribution by the County Council is reduced.

So basically, she has to get down to £14250 before they stop taking her money (cash, investments, property).

Regardless of all the above, they still take ALL of her pensions and leave her with £25 a week spending money. It's a bit harsh in my opinion.

The care home she is in is the most reasonable I have found. Some of them are horrible and cost the earth. Even so, the cost of her care is £2400 / month.

The assessors go back years through bank accounts and records to make sure no-one has tried to divert funds elsewhere.

If a house is to be transferred to children, it has to be done 7 years before there is a requirement for care, which will involve some extreme advanced planning. If you are thinking of doing this, do it now!

Rob.

There's a limit to how much you can gift though - I thought it was about £45K per annum tax free. If you gift a house it may be liable to IT.

If you gift a house and death occurs more than 7 years after the completion of the conveyance then it is not subject to Inheritance Tax.

https://www.gov.uk/inheritance-tax/gifts

Fretwired · May 2017

fretmeister said:

If you gift a house and death occurs more than 7 years after the completion of the conveyance then it is not subject to Inheritance Tax.

https://www.gov.uk/inheritance-tax/gifts

OK thanks. Didn't know that.

mellowsun · May 2017

NI contributions as they are won't cover the cost of long term care. What's needed is a pooled risk model where pensioners (or anyone) can start paying into an additional insurance scheme to pay for care if it's needed.

This would be a national, public scheme, not private, as we know that private insurers would have too many exclusion clauses.

It would be a voluntary scheme but if you don't pay into it then your assets are used to pay for care as currently.

DarnWeight · May 2017

mellowsun said:

NI contributions as they are won't cover the cost of long term care. What's needed is a pooled risk model where pensioners (or anyone) can start paying into an additional insurance scheme to pay for care if it's needed.

This would be a national, public scheme, not private, as we know that private insurers would have too many exclusion clauses.

It would be a voluntary scheme but if you don't pay into it then your assets are used to pay for care as currently.

This is the core difference between the Tory proposals and Andy Burnham's (remember the tabloid hysteria around "the Death Tax"?). A pooled scheme would remove the risk of a social care "lottery" based on individuals' ability to finance or pay for their care.

quarky · May 2017

fretmeister said:

They have paid National Insurance for 40+ years at that point. So they have paid for that care.

They shouldn't be paying twice.

They should also have transferred ownership of the house to the kids by then. If death occurs more than 7 years from the date of the gift there won't be any inheritance tax on it.

That is what seems wrong to me. It means the rest of us are picking up the bill, when the family could afford it, but won't have to pay for it. And yes, they may have paid NI for 40 years, but they may also have had a pension for 20+ too. No one should be broke because of the cost of care, but with an ageing population, why should the cost fall on everyone else when they can afford it? Not sure there is any easy answer besides means testing, and looking closely at the transference of assets (including houses) to kids.

I do think a £100k limit is much more reasonable than £24k though!

rlw · May 2017

The other side of the coin is the people who have never worked or never saved or never contributed who will be funded by the state regardless. Perhaps we should charge their heirs for looking after them too.

I'm not saying either is right or wrong by the way.

And consider this scenario. An older person in need of care sells their home and pisses all the money up the wall, with cruises for the extended family, treats for all the grandchildren and so on. Finally, they have no money but they still need the care. Who funds it then?

Fretwired · May 2017

Jalapeno said:

quarky said:

Or is it? Is it really fair that as people get older, they can pass on their £500,000 house to their kids and expect the state to pick up the cost of their care? I must admit, that doesn't seem right to me.

http://www.msn.com/en-gb/news/uknews/tories-to-cut-winter-fuel-payments-for-wealthiest-pensioners-as-they-launch-manifesto/ar-BBBfr2Z?li=AAmiR2Z&ocid=spartanntp

Just to challenge that - is it fair if you live with a parent in the family home as a carer that you lose your home due to care costs of your parent (albeit care at home or when they have to go to residential care) ?

But who owns the house? Who paid for it?

Fretwired · May 2017

fretmeister said:

They have paid National Insurance for 40+ years at that point. So they have paid for that care.

National insurance doesn't cover the cost .. nowhere near. The sooner governments come clean the better.

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Knife in the back for pensioners..

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