Elderly parents : advice needed

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whentheballmoves
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Elderly parents : advice needed

Post by whentheballmoves » Tue Jan 05, 2021 12:05 pm

Morning, all.
Bit of a delicate one, this. Please be gentle.
Both my parents, who live in Pendle, are now in their mid 70s.
I'm an only child, and live in Sheffield, 1 h 30 away.
Their health is "alright" : mum has had early onset parkinson's for a few years now. Dad overweight, but not obese.
Basically, I want to know what, financially, we/they should be doing at present, rather than waiting until it's "too late".
Thinking about their house, savings, etc. Particularly when they may potentially face medical, nursing home type fees. Inheritance tax, government taking their cuyt, and so on.
Hope none of the above sounds too cold, just trying to be practical, especially as it's going to largely fall to me to sort stuff out in the coming years.
I just figured plenty of people on here, (un)fortunately, will have had loads of similar experiences.
Thanks in advance,
Martin

Steve1956
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Re: Elderly parents : advice needed

Post by Steve1956 » Tue Jan 05, 2021 12:11 pm

Sort their money out,if you dont and they have to go into care,my Mum is currently paying £2250 a month for her care out of her savings which she has diligently been saving all her live,they will take everything till she is down to her last 23,000 which at the costs of care wont be long....so wrong they take your savings....although I bet some on here will disagree and say she should pay for her care.
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TVC15
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Re: Elderly parents : advice needed

Post by TVC15 » Tue Jan 05, 2021 12:13 pm

I would consider taking some financial advice on this.
One of the first things I would do is sort out the power of attorneys - both of them for health and finances. This should cost you around £700 in total to register and I can give you a contact if needed (I used this form of solicitors and they were excellent and I’ve used them for many years now)
I’d also ensure that adequate wills are in place - again I used the same firm of solicitors for this.

In terms of transferring the properties out of their name to avoid potential future care home fees and this coming from their assets this is a bit of minefield at the moment and local authorities have cottoned on to this practice - if they can establish this has been done when there are known existing medical conditions then they could / will still come after people for these monies.

As said it’s a really difficult situation and you are doing the right thing to start looking at this now. Hope the situation is not to painful for you and good luck to you and your family.

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Re: Elderly parents : advice needed

Post by Steve1956 » Tue Jan 05, 2021 12:14 pm

I have power or attorney over my Mums affairs and believe me they want to know every single penny she has,including two years bank statements...and everything they do is legal.

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Re: Elderly parents : advice needed

Post by wilks_bfc » Tue Jan 05, 2021 12:14 pm

From experience with my grandad, I’d apply for power of attorney for a starter.

They may be fully capable now but it makes a lot easier later down the line if/when they are no longer able to make decisions.

You don’t have to “use” it but there just in case.

I’d also recommend, if they are happy, for you to be named on any bank accounts, again makes things easier when things happen

Boss Hogg
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Re: Elderly parents : advice needed

Post by Boss Hogg » Tue Jan 05, 2021 12:15 pm

If you want professional advice I specialise in this area and I am happy for you to obtain my email address from the moderator. I can then provide you with my details and credentials and see if you wish to discuss it further. I won’t discuss it on here though.

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Re: Elderly parents : advice needed

Post by Bosscat » Tue Jan 05, 2021 12:17 pm

Steve1956 wrote:
Tue Jan 05, 2021 12:14 pm
I have power or attorney over my Mums affairs and believe me they want to know every single penny she has,including two years bank statements...and everything they do is legal.
My brother and I had the same with our Mum 7 years ago... we had full power of Attorney not just financial...

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Re: Elderly parents : advice needed

Post by cbx750 » Tue Jan 05, 2021 12:19 pm

You can do power or attorney without solicitors if you feel up to it for just the cost of registration, all the info is on the government web site.

TVC15
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Re: Elderly parents : advice needed

Post by TVC15 » Tue Jan 05, 2021 12:21 pm

Steve1956 wrote:
Tue Jan 05, 2021 12:11 pm
Sort their money out,if you dont and they have to go into care,my Mum is currently paying £2250 a month for her care out of her savings which she has diligently been saving all her live,they will take everything till she is down to her last 23,000 which at the costs of care wont be long....so wrong they take your savings....although I bet some on here will disagree and say she should pay for her care.
It’s a disgrace Steve - absolutely heartbreaking. One of the biggest crimes of society in recent decades has been the complete lack of response in dealing with this.
The over 85s has been the fastest growing demographic for many years now so they all knew this was coming but decided it was too difficult and expensive to fix and probably that by definition this was an expendable part of the population...plus if all political parties decide to do feck all about it as they have then what can any of us do about it ?

beddie
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Re: Elderly parents : advice needed

Post by beddie » Tue Jan 05, 2021 12:21 pm

Martin. You would be far better seeking independent legal advice, it can become a bit of a mine field and often people get themselves into a bit of a pickle with it. There'll be a local Solicitor that deals with Wills and Probate near you, several give first free interview so I'd really encourage you to take that up. Long term I'm sure it will be of benefit to you and your family. Just to add I've seen a lot of real problems over the years with people thinking they know how to deal with it themselves. Good luck in whatever you decide.

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Re: Elderly parents : advice needed

Post by Clarets4me » Tue Jan 05, 2021 12:24 pm

Hi Martin,

From how you've phrased things, it appears that your parents are relatively comfortably off, especially if you're talking in terms of a potential Inheritance Tax liability. A good Financial Advisor should be able to advise on such matters, my parents used the Skipton, who were very good, if not cheap. Of course, other Advisors are available ....

The one thing you should do is to ensure they have up to date wills, and you should discuss putting a " Power of Attorney " arrangement in place, in case they reach the point where one or both of them are unable to conduct their financial affairs for themselves.

Hope this helps ....

whentheballmoves
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Re: Elderly parents : advice needed

Post by whentheballmoves » Tue Jan 05, 2021 12:29 pm

Thanks, guys.
Boss Hogg... my email is my username @hotmail.com

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Re: Elderly parents : advice needed

Post by DCWat » Tue Jan 05, 2021 12:37 pm

How much is the annual care bill for the UK and how much would it equate to for every working adult to fund it?

I think my Mum set up some sort of bond that can’t be included as part of care fees, should it be needed, though that wouldn’t stop her property and savings being used.

I may be wrong but I think that they nay even go back six years to check for any attempts to hide money - such as signing over a property to another name.

whentheballmoves
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Re: Elderly parents : advice needed

Post by whentheballmoves » Tue Jan 05, 2021 12:53 pm

Clarets4me wrote:
Tue Jan 05, 2021 12:24 pm
Hi Martin,

From how you've phrased things, it appears that your parents are relatively comfortably off, especially if you're talking in terms of a potential Inheritance Tax liability. A good Financial Advisor should be able to advise on such matters, my parents used the Skipton, who were very good, if not cheap. Of course, other Advisors are available ....

The one thing you should do is to ensure they have up to date wills, and you should discuss putting a " Power of Attorney " arrangement in place, in case they reach the point where one or both of them are unable to conduct their financial affairs for themselves.

Hope this helps ....
Yeah, not paupers, but not millions in the bank!
Both worked all their lives, but neither in a well paid job.

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Re: Elderly parents : advice needed

Post by Herts Clarets » Tue Jan 05, 2021 1:00 pm

I discussed this with my parents, similar age to yours Xmas last year. I suggested a couple of ideas regarding their property, which will be the biggest asset and there is legislation most ways you turn with it. Put it into a trust and it can be seen as deliberately hiding wealth. I suggested gifting the property and then renting it back to them but there is CG tax and they then have to pay a market rate rent, which you are taxed on the income. I would suggest you take legal advice on this.

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Re: Elderly parents : advice needed

Post by Steve1956 » Tue Jan 05, 2021 1:04 pm

TVC15 wrote:
Tue Jan 05, 2021 12:21 pm
It’s a disgrace Steve - absolutely heartbreaking. One of the biggest crimes of society in recent decades has been the complete lack of response in dealing with this.
The over 85s has been the fastest growing demographic for many years now so they all knew this was coming but decided it was too difficult and expensive to fix and probably that by definition this was an expendable part of the population...plus if all political parties decide to do feck all about it as they have then what can any of us do about it ?
I dont know if it's common practice or just because I live away from Lancashire,but I was rung by a woman from LCC who grilled me over the phone like some Gestapo type interrogation ,she asked me questions about my Mums spending habits HTF do I know what my Mum spends her money on,and as for two years previous bank accounts....WTF has it got to do with them what my Mum spent her money on 2 years previous,there really was no sympathy to my mums plight....it was like how much money has she???..3 days later I got the bill for Mums care.
Heartless tw@ts

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Re: Elderly parents : advice needed

Post by Sproggy » Tue Jan 05, 2021 1:06 pm

They can start "gifting" you things. If they live for 7+ years after the gift, there is no inheritance tax to pay.

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

TVC15
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Re: Elderly parents : advice needed

Post by TVC15 » Tue Jan 05, 2021 1:07 pm

Steve1956 wrote:
Tue Jan 05, 2021 1:04 pm
I dont know if it's common practice or just because I live away from Lancashire,but I was rung by a woman from LCC who grilled me over the phone like some Gestapo type interrogation ,she asked me questions about my Mums spending habits HTF do I know what my Mum spends her money on,and as for two years previous bank accounts....WTF has it got to do with them what my Mum spent her money on 2 years previous,there really was no sympathy to my mums plight....it was like how much money has she???..3 days later I got the bill for Mums care.
Heartless tw@ts
I would have told her to politely go f-uck herself and leave you alone.

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Re: Elderly parents : advice needed

Post by huw.Y.WattfromWare » Tue Jan 05, 2021 1:09 pm

DCWat wrote:
Tue Jan 05, 2021 12:37 pm
I think my Mum set up some sort of bond that can’t be included as part of care fees, should it be needed, though that wouldn’t stop her property and savings being used.
My Mother-in-law did this and when she sadly passed it was successful.

Re:the OP.
We slide money over to the kids every chance we’ve got. I don’t know the current UK rate but I recall it being £3k tax exempt annually, gift tax I think they call it.
Unfortunately you would be on the recipient end and it could look dodgy. A good accountant will know how to cut corners. Look into DCWat’s comment.
Use a solicitor for the will. We had a disaster as M-in-L did a postal one that a son-in-law witnessed on her asking. Because of this his wife was not entitled to her substantial payout. Mrs Huw, quite rightly, signed her portion over to her. The other sister kept it, b1tch.

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Re: Elderly parents : advice needed

Post by TVC15 » Tue Jan 05, 2021 1:11 pm

Sproggy wrote:
Tue Jan 05, 2021 1:06 pm
They can start "gifting" you things. If they live for 7+ years after the gift, there is no inheritance tax to pay.

https://www.gov.uk/inheritance-tax/gifts
That’s right - and their is no limit to the gift value as most people commonly think it’s £3k per annum.
Plus the inheritance tax thresholds are actually higher than most people realise. You inherit your spouses allowance and there are thresholds for your property too. Can’t remember the exact figure it all totals to but sure it’s at least £700k in total before you would have to pay any tax.

Steve1956
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Re: Elderly parents : advice needed

Post by Steve1956 » Tue Jan 05, 2021 1:12 pm

TVC15 wrote:
Tue Jan 05, 2021 1:07 pm
I would have told her to politely go f-uck herself and leave you alone.
That's the problem you cant, the whole £2250 is just for care,if she wants a hairdresser or a chiropadist it's all extra,these care homes really are thieves how do you justify those type of fees

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Re: Elderly parents : advice needed

Post by jollyjack » Tue Jan 05, 2021 1:20 pm

Investigate purchase of a care annuity from her funds when needed. A gamble as to how long they will live one in care. Calculated by actuaries whose predictions of life expectancy are pretty good! Mum in law outlasted them by 18 months or so so £30000 ish of "free" care provided in the end. She also had her funds in an investment bond with a life assurance element which meant it couldnt be used in calculations of wealth for care purposes, though they had to use their LPA to buy the annuity from these funds.

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Re: Elderly parents : advice needed

Post by Stalbansclaret » Tue Jan 05, 2021 1:30 pm

My parents jointly owned their house but several years before they died my mum arranged for this to be changed to a "tenants in common" arrangement. This meant that their two halves of the house became regarded as entirely separate assets, with each owning 50%, so that when my mum subsequently died her half was left to myself and my brother in her will and not automatically passed too my dad (as would be the case under joint ownership). This meant that my mum's half of the house could never be included in any subsequent assessment of my dad's means.

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Re: Elderly parents : advice needed

Post by SalisburyClaret » Tue Jan 05, 2021 1:39 pm

Have been through this with my Mum, Uncle and Mum in Law - so my two pennorth-
No 1 - get both types of power of attorney done now. If you’re a competent form filler you don’t need a solicitor but you will need doctor’s letters etc
No 2 - get proper wills drawn up - you will need a highly competent solicitor ( not a form from WH Smith’s) and you will need to get to grips with the administration of trusts. This can ring fence what can and can’t be used for care. It will affect how your parent’s property can be used in future so make sure you’re comfortable with this
3. Gift what you can while you can
4 . Start now

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Re: Elderly parents : advice needed

Post by Jakubclaret » Tue Jan 05, 2021 2:25 pm

The very first thing you should do is (surprised this hasn’t been suggested) sit down & have a very deep meaningful conversation with your parents & let them decide for themselves what future course should be taken, after that point you can ascertain what finances they hold & determine what should be allocated for what, you don’t need to preempt problems but always mindful of what could potentially happen at any given juncture, whilst the cognitive functions are relatively healthy a serious discussion needs to happen before you take upon yourself to do anything, good luck.

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Re: Elderly parents : advice needed

Post by aggi » Tue Jan 05, 2021 2:30 pm

Sproggy wrote:
Tue Jan 05, 2021 1:06 pm
They can start "gifting" you things. If they live for 7+ years after the gift, there is no inheritance tax to pay.

https://www.gov.uk/inheritance-tax/gifts
Bear in mind it has to be a true gift. You can't "gift" a car and continue using it or gift a property and continue living there (without paying market rent), etc

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Re: Elderly parents : advice needed

Post by nil_desperandum » Tue Jan 05, 2021 2:45 pm

cbx750 wrote:
Tue Jan 05, 2021 12:19 pm
You can do power or attorney without solicitors if you feel up to it for just the cost of registration, all the info is on the government web site.
Yes. It's very simple to do yourself. If you are capable of logging onto this site and using it then you should be able to save solicitor fees. (Of course you need quite a bit of info to do it, but a solicitor would require that from you anyway. You need witnesses to certify certain things, but a neighbour can do this, it needn't be a legally qualified person).
I think it's about £80, but you have to pay that both for "health" and "money", so if you want both then it's about £160.
It's important to set this up whilst the person still has "mental capacity" to agree to it and sign it off.

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Re: Elderly parents : advice needed

Post by whentheballmoves » Tue Jan 05, 2021 3:05 pm

Jakubclaret wrote:
Tue Jan 05, 2021 2:25 pm
The very first thing you should do is (surprised this hasn’t been suggested) sit down & have a very deep meaningful conversation with your parents & let them decide for themselves what future course should be taken, after that point you can ascertain what finances they hold & determine what should be allocated for what, you don’t need to preempt problems but always mindful of what could potentially happen at any given juncture, whilst the cognitive functions are relatively healthy a serious discussion needs to happen before you take upon yourself to do anything, good luck.
Would have done that this Xmas, but they were only over here for a few hours. Not sure it's something to do over the phone, but it may have to be. Goodness knows how long this covid stuff will go on for...

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Re: Elderly parents : advice needed

Post by huw.Y.WattfromWare » Tue Jan 05, 2021 3:20 pm

whentheballmoves wrote:
Tue Jan 05, 2021 3:05 pm
Would have done that this Xmas, but they were only over here for a few hours. Not sure it's something to do over the phone, but it may have to be. Goodness knows how long this covid stuff will go on for...
BTW. You don’t sound cold, from your OP, at all just sensibly protecting your parents hard earned assets. Good luck.

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Re: Elderly parents : advice needed

Post by Guppyspotter » Tue Jan 05, 2021 3:47 pm

1. Power of attorney, health and financial affairs.
2. Inheritance tax threshold now up to £700,000 plus for married couple plus allowance of some of the house value which I'm not up to date with but can take it £850k plus so not going to effect everyone.
3. Annual gifts up to the limits including backdating to previous tax year.
4. Lifetime gifts which will be tax free for inheritance tax purposes if the grantor survives 7 years after making. Death before then can bring it partly back into the estate.

Apologies in advance if blunt.

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Re: Elderly parents : advice needed

Post by Paul Waine » Tue Jan 05, 2021 3:53 pm

whentheballmoves wrote:
Tue Jan 05, 2021 3:05 pm
Would have done that this Xmas, but they were only over here for a few hours. Not sure it's something to do over the phone, but it may have to be. Goodness knows how long this covid stuff will go on for...
Hi wtbm, I'm on the other side of this discussion - I need to do my own will and organise power of attorney (both financial and health). Some years back both my parents asked me to be their respective power of attorney. (Now more than 10 years since they both passed. RIP).

First thing first: it's for your parents each to make their own decisions. It's great that you are there to assist them, if that's what they want. But, you should not push anything that either of them are uncomfortable with. If they don't want to make poa and don't want to write their wills, then that's how it's got to be.

My Mum was the "bookkeeper" in their marriage. She liked to keep control of everything, whether it was bank statements and all other correspondence. She continued like this when she lost her eyesight with age related macular degeneration and was registered blind. It was good I had poa, but she still wanted to know and keep her own control everything, so I was simply providing her eyes and agreeing with her what she wanted to do. That was better than me making her decisions for her.

Secondly, get to know the rules about dying intestate - i.e. what happens to that parent's money/assets if they were to die without having made a will. In simple terms, there's a certain amount will transfer from the deceased to their spouse and then, over certain limits, there are amounts for the children. I'm sure you and your parents can get info from Age UK, and I think there's a Money Advice Service that the Gov't has set up.

Thirdly, as already said, understand how they own their home - commonly they own it jointly, so when one is deceased it is automatically 100% owned by the other (same with join bank accounts). It may be that it's not worth going to the expense of changing the ownership - there've been two very important changes to inheritance tax over the past 12 (?) years. The first one is the transfer of IHT allowance from deceased partner to their spouse, the second one is the extension of IHT allowance to home left to descendants. It used to be £325,000 before IHT was payable. The first change meant it increased to £650,000 and the second extends that to £1 million. (I've not checked if these rates are still the same today - remember, rates as well as rules can change).

My final point, don't be too anxious about avoiding care home fees. Let you parents make these decisions for themselves. One or both of them might feel that they want to be able to pay their way if they need to go into care. They might want to retain their own home and live independently for the rest of their lives.

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Re: Elderly parents : advice needed

Post by dsr » Tue Jan 05, 2021 3:56 pm

aggi wrote:
Tue Jan 05, 2021 2:30 pm
Bear in mind it has to be a true gift. You can't "gift" a car and continue using it or gift a property and continue living there (without paying market rent), etc
Slightly to add to this - gifting a house and continuing to live there rent-free has no effect for Inheritance Tax, but it can have an effect in reducing nursing home fees as long as it wasn't done when going into a home was already planned.

Mind you, tenants in common sounds better. There are other drawbacks towards gifting assets to your children that you haven't finished with - the biggest one being that if that child gets divorced, the spouse may get half of Mum & Dad's house at obvious inconvenience to Mum & Dad.

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Re: Elderly parents : advice needed

Post by whentheballmoves » Tue Jan 05, 2021 3:59 pm

huw.Y.WattfromWare wrote:
Tue Jan 05, 2021 3:20 pm
BTW. You don’t sound cold, from your OP, at all just sensibly protecting your parents hard earned assets. Good luck.
Thanks...I was just a bit worried it might do, given the topic of conversation!

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Re: Elderly parents : advice needed

Post by LeadBelly » Tue Jan 05, 2021 3:59 pm

I'm over 70, not in bad health but aware I might well snuff it in the next decade or so.

I've got enough pension income to live off comfortably (no cruises or such like but all the sports/musical events I wish to attend and to buy nice food & drink) and have paid off my mortgage & live alone. I've given away most of my saved money to my kids in the last few years. I dont really need it (other than a £5k ish emergency fund) and they need it much more now than in (say) 10 years when I shuffle off this mortal coil.

I doubt my kids would've suggested that - it seems very mercenary (and they arent). A logical thing to do in my circumstances IMO but probably a very difficult thing for a child to suggest to an aging loved parent.

dsr
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Re: Elderly parents : advice needed

Post by dsr » Tue Jan 05, 2021 4:00 pm

One thing about power of attorney, incidentally. It does not give you the right to make decisions unless the person concerned is unable to decide for him- or herself. You can get a power of attorney while your parents are still fully able to look after their own money and it gives you powers over their money which you aren't allowed to exercise. Strange though it seems.

Clearly it can be dangerous in the wrong hands!

(For the record, that comment is entirely general and not directed towards the OP. I have no reason to doubt that the OP is an entirely honest and loving son.)

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Re: Elderly parents : advice needed

Post by Hipper » Tue Jan 05, 2021 4:01 pm

Steve1956 wrote:
Tue Jan 05, 2021 12:11 pm
Sort their money out,if you dont and they have to go into care,my Mum is currently paying £2250 a month for her care out of her savings which she has diligently been saving all her live,they will take everything till she is down to her last 23,000 which at the costs of care wont be long....so wrong they take your savings....although I bet some on here will disagree and say she should pay for her care.
TVC15 wrote:
Tue Jan 05, 2021 12:21 pm
It’s a disgrace Steve - absolutely heartbreaking. One of the biggest crimes of society in recent decades has been the complete lack of response in dealing with this.
The over 85s has been the fastest growing demographic for many years now so they all knew this was coming but decided it was too difficult and expensive to fix and probably that by definition this was an expendable part of the population...plus if all political parties decide to do feck all about it as they have then what can any of us do about it ?
There's nothing wrong with this at all. If your parents don't pay for their care then someone else will have to. Do you really expect 'the young' to pay for this in top of all the other legacies we olduns are leaving for them? In effect what the state is doing is taking away your inheritance to pay for your parents care. I don't see what's wrong with that. The only criticism would be of fairness, where those who don't take financial care of themselves end up getting the same care for no cost that those who have looked after their money have the 'privilege' of paying for. I don't know what you can do about that except insist on insurance for this, or increase taxes considerably so everyone gets it for nothing.

For the OP, Powers of Attorney have been mentioned. Obviously an up to date will and perhaps you or another family member would be willing to be the Executor. I did that for my Mum and it's not as daunting as I thought it would be.

Setting up and paying for their funerals in advance is also a good idea because that would be another burden reduced for the remaining family to deal with.

There is some non means tested payment you will be entitled to if they need carers. Going into a retirement home is also considered to be 'needing carers'.

There are those kind of insurance policies you can buy when the time comes to go into a care home - the ones where you pay x amount lump sum (from the sale of their house probably) and then the insurers guarantee that as long as your parent remains alive they will pay a certain amount per month which will cover care home costs and a small bit more. Basically they are gambling your parent will die quickly and you are hoping they live a long time. When I looked into this I found they needed to live three years to justify the cost. My mum died within a year of going into a care home, which is apparently quite common.

In the end we went with a bond which would have been better except the initial set up fees were not covered by the year of its investment so we, the relatives, ended up with a bit less then she had put in.

An independent financial advisor, perhaps one specialising in this area, is surely worthwhile consulting.

Most importantly I think, the longer your parents can stay in their own home, with appropriate care support if necessary, the happier they will be. If their house needs adapting (stairlifts etc.) and funds aren't readily available, consider Equity Release.
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aggi
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Re: Elderly parents : advice needed

Post by aggi » Tue Jan 05, 2021 4:06 pm

Paul Waine wrote:
Tue Jan 05, 2021 3:53 pm
... The first one is the transfer of IHT allowance from deceased partner to their spouse, the second one is the extension of IHT allowance to home left to descendants. It used to be £325,000 before IHT was payable. The first change meant it increased to £650,000 and the second extends that to £1 million. (I've not checked if these rates are still the same today - remember, rates as well as rules can change).
...
I don't think this has ever been the case.

There's no IHT if leaving to a partner (or a charity). Otherwise there's a tax-free cap of £325k for the estate value. This is increased to £500k if you're leaving a home to children/grandchildren.

EDIT: Ignore me, I can't read.
Last edited by aggi on Tue Jan 05, 2021 4:38 pm, edited 1 time in total.

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Re: Elderly parents : advice needed

Post by TVC15 » Tue Jan 05, 2021 4:11 pm

aggi wrote:
Tue Jan 05, 2021 4:06 pm
I don't think this has ever been the case.

There's no IHT if leaving to a partner (or a charity). Otherwise there's a tax-free cap of £325k for the estate value. This is increased to £500k if you're leaving a home to children/grandchildren.
I think what PW was saying that you “inherit” the allowance from your spouse after they pass away.

If you’re married or in a civil partnership and your estate is worth less than your threshold, any unused threshold can be added to your partner’s threshold when you die. This means their threshold can be as much as £1 million.
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Re: Elderly parents : advice needed

Post by huw.Y.WattfromWare » Tue Jan 05, 2021 4:28 pm


aggi
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Re: Elderly parents : advice needed

Post by aggi » Tue Jan 05, 2021 4:31 pm

TVC15 wrote:
Tue Jan 05, 2021 4:11 pm
I think what PW was saying that you “inherit” the allowance from your spouse after they pass away.

If you’re married or in a civil partnership and your estate is worth less than your threshold, any unused threshold can be added to your partner’s threshold when you die. This means their threshold can be as much as £1 million.
Ah yes, I read that totally differently for some reason and thought it was about transferring assets to a spouse, not allowances.
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Re: Elderly parents : advice needed

Post by Paul Waine » Tue Jan 05, 2021 4:32 pm

aggi wrote:
Tue Jan 05, 2021 4:06 pm
I don't think this has ever been the case.

There's no IHT if leaving to a partner (or a charity). Otherwise there's a tax-free cap of £325k for the estate value. This is increased to £500k if you're leaving a home to children/grandchildren.
Rules were changed when Gordon Brown became PM, when there was a chance that Cameron/Osborne would win an election. Prior to then, if one spouse died and passed everything to spouse, so didn't use their own IHT allowance, then the surviving spouse only had their own "single person" allowance to set against their estate.

That could be one reason why changing home ownership structure (joint owners v tenants in common) may have been worthwhile - depending on the value of the home.

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Re: Elderly parents : advice needed

Post by whentheballmoves » Tue Jan 05, 2021 4:35 pm

huw.Y.WattfromWare wrote:
Tue Jan 05, 2021 4:28 pm
Martin Lewis article.
https://www.moneysavingexpert.com/family/death-plan/
Thanks, huw!

I should add my parents don't have the Internet - they still use computers in the library! (I know....!)

I'll have to ask them what they think next time I speak to them on the phone, I reckon...

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Re: Elderly parents : advice needed

Post by Paul Waine » Tue Jan 05, 2021 4:37 pm

dsr wrote:
Tue Jan 05, 2021 4:00 pm
One thing about power of attorney, incidentally. It does not give you the right to make decisions unless the person concerned is unable to decide for him- or herself. You can get a power of attorney while your parents are still fully able to look after their own money and it gives you powers over their money which you aren't allowed to exercise. Strange though it seems.

Clearly it can be dangerous in the wrong hands!

(For the record, that comment is entirely general and not directed towards the OP. I have no reason to doubt that the OP is an entirely honest and loving son.)
I'm not a lawyer, however, my understanding is that a person cannot make a valid power of attorney if they are not "in sound mind." There's a much more complicated and expensive procedure required if the person who wants/need to appoint a poa is not of sound mind.

BTW, you can make decisions for someone who is capable of making them for themselves. I held poa for both my parents and that's how it worked.

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Re: Elderly parents : advice needed

Post by Foreverly Claret » Tue Jan 05, 2021 4:44 pm

Interesting post and some very useful responses .I see one poster in particular has particular expertise in this field and my advice would be to take him up on his offer...I don't know him but a lot can be done from both points of view...viz IHT AND Care Costs if you take action soon enough .I think the IHT bit is relatively easy to sort but care costs is where your family will be royally screwed if you don't sort matters well before the evil day.

I speak from bitter personal experience...my late dad was in a Burnley Nursing Home for five years before he died and self -funded throughout...he was definitely not a rich man but he did have more than the threshold ( now about £23000 ) so he received no help whatsoever.

More recently my aunt , now turned 100 , has become incapable of looking after herself and after a period of self-funded home help from a great company based in Burnley she has had to go into a home in Colne .She , too , has been relatively frugal since her husband died 30 years or more ago and has more than £23000 in savings .Her basic pension plus attendance allowance is £240 per week ( she gets the maximum attendance allowance because she can't walk )...until recently she was paying £750 per week but in December we were notified that the Home was increasing her fee by £46 per week to a new eyewatering figure of £796 per week .An increase of over 6% when her pension etc. might increase by about 2.5% from April.

I have a power of Attorney but my protestations about the increase ( its a privately owned home ) fell on totally deaf ears and she is lumbered ! The problem is that it's very difficult to move somebody once they are resident...who wants that problem when you are 100 ? They can charge what they like because there is , in reality , very little competition . We looked at some very nice LCC homes when she was discharged from hospital but they had no availability at the time and there's no way she can move now.

I'm not going to go on about whether she's getting value for money..she isn't ...but the advice to you ( OP ) is that you MUST have the conversation with them ; you MUST take advice on IHT and prospective care costs because the system stinks as it stands...believe me £40k a year is not unusual and its not going to get any cheaper .I'm not saying that care should be free..that would be crazy...what I am saying is that the system needs overhauling and that's not going to happen anytime soon so get ready for the evil day and start by taking the guy ( Bosscat ? ) up on his offer .

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Re: Elderly parents : advice needed

Post by Jakubclaret » Tue Jan 05, 2021 6:21 pm

Steve1956 wrote:
Tue Jan 05, 2021 1:12 pm
That's the problem you cant, the whole £2250 is just for care,if she wants a hairdresser or a chiropadist it's all extra,these care homes really are thieves how do you justify those type of fees
The health care system seriously needs revamping & changing, should be 1 set fee for everybody capped by the government to a reasonable level & regulated more stringently in the private sector, every cost breakdown should be itemised, nobody should be paying more an 1k a week & that’s with everything included.

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