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To be unsure whether to give the money back?

(58 Posts)
garlicandsapphire Tue 07-Feb-17 08:16:46

My elderly Mum gave me and my sister and brothers some money last year - not enough to pay off the mortgage or anything but enough to pay off credit cards and get work done on the house which was a great help. Since then she's been ill and is now asking for it back as she's fretting about her financial well-being and paying for care in the future. This is despite the fact she still has a lot of money (half a million in cash and her house) and that I've shown her calculations that show she spends less than her income and that she has plenty to pay for all her likely needs in the future. I have also said whatever happens we will cover her costs and take care of her.

She says it every time I see her and I'm feeling I ought to give at least some of it back but neither my sister or brothers (who see her less often) feel inclined to do so. I just feel really horrid every time I see her. I could still give her half of it back but if I have to give her the lot I'd have to take out a bank loan. AIBU to not pay it back?

MycatsaPirate Tue 07-Feb-17 08:27:01

That's a very difficult position to be in.

It was given as a gift I presume so no paperwork to say it was a loan. So presumably you have all spent it or most of it on getting things done or clearing debt.

Half a million pounds won't last long if she needs full time care though. It costs our neighbours £1k a week to care for their mum, that's having carers in 4 times a day.

I honestly don't know what to suggest. If your mum needs care then the money she has will be used and then I presume she can claim for care from the government/council. You all giving the money back wouldn't make a huge dent in the care costs if it's needed.

Have you asked your siblings what they think?

PurpleDaisies Tue 07-Feb-17 08:28:43

Was it given as a gift or a loan?

violetbunny Tue 07-Feb-17 08:29:53

That is a tough one. Is she aware that the money has been spent and that you'd have to take out a loan to repay her? If not then I think you have to spell out the situation for her and what it means for you, given that you accepted on the basis that it was a gift and now no longer have it to return.

picklemepopcorn Tue 07-Feb-17 08:29:59

You could get tax stung if she dies within seven years of the 'gift', as well. I can't remember the technical term.

Apart from that I think I'd have to keep explaining that you don't have it any more, because you spent it on the house, but you'll look after her and keep her safe.

ImperialBlether Tue 07-Feb-17 08:30:48

But then that would be 500 weeks of care!

Trifleorbust Tue 07-Feb-17 08:31:13

Same question as PP: gift or loan? If a gift, she is BU (how old is she? In the nicest possible way, is there any chance she may have forgotten or been confused?). If she loaned you money then it goes without saying that you should repay her, regardless of why she feels she needs it back.

RedAndYellowStripe Tue 07-Feb-17 08:48:24

If it's a gift, I can see where you are coming from.
Assuming she is asking the same to your siblings and not just you, I would assume she is really scared. Yes going through what she might need money wise should reassure her but it clearly isn't atm.
I would have a word with your siblings so that you can all chip in to reassure her, show her she will be OK financially even with paying for a nice care home if she needs one. Maybe tell her that you will be there to help financially if she need to too.

Re inheritance tax, yes, a gift is only a gift and free of tax if it has been done more than seven years before the death of the person. Otherwise it counts towards the inheritance. It doesn't mean you have to give the money back btw. Just that you might end up paying some tax on it iyswim.

RebelandaStunner Tue 07-Feb-17 08:54:07

Don't give it back and definitely don't get a loan. Sounds to me like she should have given you and your siblings a lot more and earlier. I don't get this mentality of old people that they might suddenly need their £500k savings? When they have DC and gdc to gift to.
Some of our relatives have been giving all of us money over many years and we will too.
My friend's parents have given her nothing as they want to die millionaires hmm
Your dmum is panicking, she will still be looked after however much she has.

Liiinoo Tue 07-Feb-17 08:54:26

This is really tricky. She is BVU but if she is old and worried that is forgiveable. That said you can't give her what you don't have and getting a loan out for an amount she has sitting in the bank seems ridiculous.

Can you compromise? Give her what is left and tell her that if she needs help with care costs in later years you will take a loan out then?

shovetheholly Tue 07-Feb-17 08:57:41

Does she understand how the care system works? It sounds like she might need it explaining to her. She'll be a private client until the cash runs out, and then the state will pay.

Welshmaenad Tue 07-Feb-17 08:59:52

I don't understand why anyone is paying £1k a week for 7x4 Homecare. If someone actually needs that level of support they should have been assessed by adult services and a care package organised by the local authority. The person would have to make a means tested contribution but only up to a maximum level. In my LA the maximum service user contribution to non residential care services is £60 per week regardless of financial status, we pay the rest, no matter the size of the care package.

Auspiciouspanda Tue 07-Feb-17 09:03:46

No she can't give out a gift to her children then demand it back when surely she must know most of its already been spent. Does she not realise that demanding it back will put her children in financial difficulty or does she only think about herself?

Cantusethatname Tue 07-Feb-17 09:04:13

If she's given money away at a time when she could reasonably expect that she would need care in the near future then the council will consider that deliberate deprivation of assets.

GETTINGLIKEMYMOTHER Tue 07-Feb-17 09:11:17

Shove, if a lot of money has been given away not long (less than a few years) before someone needs care, then this can be seen as deliberate deprivation of assets (whether it was done with that intention or not) and understandably councils who have to fund care are typically VERY eagle-eyed on this. They can and will demand for it be paid back.

However, if the OP's mother still has £500k and owns a house, I shouldn't imagine that this problem will arise.
Very difficult situation for the OP, though. And IMO very irresponsible of her mother to give large sums away and then ask for them back.

Personally I think I'd say that I can't pay it back at the moment, since it's been spent, but reassure her that if she does ever need more for her care, then it will be found.
Probably easier said than done, though, I know.

shovetheholly Tue 07-Feb-17 09:11:36

welsh - I think many families don't qualify for the free support (there's a difference between needs that are seen as health-related and social care). Which is where these extortionate fees start to come in.

shovetheholly Tue 07-Feb-17 09:16:28

gettinglike - yes, good point (I think the same is true of inheritance as well - you can't give away assets towards the end to evade tax). I think a lot depends on what "being ill" means, and what impacts it has for the future! My grandmother is 86 and fighting fit for her age, but was recently really distressed by a bad cold she couldn't shake off. I think it made her feel old for the first time. (She's much better now). But that's a completely different situation from having a progressive, degenerative condition.

I think the main thing is that £500k plus the value of a house should be more than adequate to cover most care needs - and if it doesn't I think, the state will pick up the tab once it's exhausted??

wettunwindee Tue 07-Feb-17 09:20:11

@RebelandaStunner

Sounds to me like she should have given you and your siblings a lot more and earlier.

Well, aren't you entitled. I'd say more but the post will be deleted.

Why should you be given anything? If I heard of my children or grandchildren talking like this I would make a point of giving everything to a local orphanage. Or their neighbours. Actually, I'd hand out 50s on the street and make many, many people happy.

Anyway OP, have you told her you've spent the money and that you would have to take out a loan? Have you and your siblings explained the system and how she won't need to pay for her own care? Does she think it was a loan?

Birdsgottaf1y Tue 07-Feb-17 09:22:05

OP, as someone who worked with people who were disabled and/or elderly, what she does need is 'talking time'.

Even if there isn't money involved, this panic stage is part of the process of ageing/becoming infirm.

As said, explain that she will be cared for and that less money doesn't mean a loss of control/autonomy.

What's in the news lately won't be helping, it's starting to panic a lot of people.

I don't think that you should take out a bank loan and pay it back, but focus on reassuring her.

Also, it's not unusual to need anti-anxiety medication as you age.

OverTheHill50 Tue 07-Feb-17 09:23:45

Welshmaenad - shove is right. Very few people qualify for social care funding if they have savings (or property) worth more than £23,000.
We have been through this twice now with my DF and my MIL, who had Parkinson's and Alzeimer's respectively.
In both cases they were assessed to have significant care needs, and then we were handed a glossy advertising brochure of all the local private care homes costing £800-£1000 per week!
This is in England. Are you in Wales? Might be different....

ProfessionalPirate Tue 07-Feb-17 09:30:35

Sounds to me like she should have given you and your siblings a lot more and earlier. I don't get this mentality of old people that they might suddenly need their £500k savings? When they have DC and gdc to gift to

Wow, how grabby and selfish are you? I can tell you from bitter personal experience that old age can be insanely expensive. The OP's mum could live til she's 100 and need every last penny of her savings. Telling elderly people they will be 'looked after' is great, but most of them that I know would rather keep their financial independence. I would also love to see my parents enjoy their retirement, go on holidays etc. not just scrape by.

OP - I don't think you should give the money back now, but perhaps you could reassure your mum that you will make it available to her should it ever be needed in the future (highly unlikely but not impossible). As I said above, some elderly people take little comfort from being told they will be taken care of, as it seems out of their control, and they can't plan.

Procrastinator1 Tue 07-Feb-17 09:31:20

I think your mum needs to get some inheritance tax advice. This year I think, no expert, an estate of over £750000 will be taxed at 40% on the excess over that sum, gifts made within 7 years of death can be added into the pot. Her property may well take her over that £750,000. She might like the idea that the gifts to you and your siblings may just amount to tax planning so that you get the money, not the government. Depends on her view of taxation I suppose.

Really worth getting and expert opinion.

ProfessionalPirate Tue 07-Feb-17 09:37:42

I think the main thing is that £500k plus the value of a house should be more than adequate to cover most care needs - and if it doesn't I think, the state will pick up the tab once it's exhausted??

Yes, she won't be out on the streets, but (assuming we're talking about residential care) she would be required to leave her pleasant private care home (huge upheaval) and move to an NHS one - and round my way at lease, they're bloody horrible. The cost of even pretty basic private care homes is eyewatering.

DJBaggySmalls Tue 07-Feb-17 09:47:59

YANBU. Either all of you repay the same amount, or you all repay nothing. What a nasty situation to be put in.

EnormousTiger Tue 07-Feb-17 09:50:49

Why not just tell her if she falls on hard times you will help her then?
I am giving money to the children now (well before I am old - just cashed my pension at 55 and gave it all to them). I would never expect it back although if I am totally on my uppers I hope they could give me a mattress on the floor to sleep on on an alternate basis through the year child to child when I'm 95 I suppose.

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