Spending downsizing cash

If she gets ill, she'll probably die quickly as the doctors won't want to treat her aggressively given her reduced odds of survival.

She’s 87, not 97. At 87 my mum got breast cancer for the third time and had successful conservative treatment. At 89 she had a stroke. At 90 she was diagnosed with vascular dementia and cardio vascular disease. At 93 she’s still here - frail but still retaining a sense of humour and an appetite for life. You absolutely cannot predict these things - a lot depends on overall state of health when these things are diagnosed. Some people are much better placed to deal with them than others.

Totally agreed.

Carers are sent and even the ones via council are very expensive.

Many millions would not have bought their homes and spent their hard earned cash if they were at the time aware of growing old, care fees, and IHT

If only this was true in England. You have to be on your last legs or have advanced dementia and be deemed a risk to yourself/others to qualify for "free" state funded care. Even then it's likely that social services will do everything in their power to keep you at home. So bed based care has become a thing. Basically you are left in bed all day with carers coming in 4 x a day to change your incontinence pads and give you food.

Soooooooo many people clearly not understanding the rules around care fees. It’s not a question of spend your money and let the LA pick up the fees later on. If you are assessed as having a reasonable expectation of needing care at the time you are spending the money it’s deprivation of assets and the LA won’t simply pick up the slack - they will assess you as though you still have those assets. And if the money was saved instead of simply indulging in a spending spree, the OP’s mum would have much more autonomy over the type and location of the care she needs, instead of having to accept what the council deems to be adequate - and from experience, there can be a massive difference between the two.

No one in my family has made it to 87 so at that age, I cannot see what the point of a rainy day fund is anymore.

If she gets ill, she'll probably die quickly as the doctors won't want to treat her aggressively given her reduced odds of survival.

You say she's burning through the cash: it sounds like she's spent a lot on one nice holiday, but at 87, she's hardly likely to enjoy backpacking and staying in hostels. Much easier to go on a more expensive tour or cruise with paid staff who are available to sort out any problems. Most people enjoy holidays, and it doesn't sound like she's had a nice one in a while, so most people would justify that.

The rest of the money she's spent on doing up her home. If and when the flat needs to be sold to fund her care, the work she's spent doing it up will make it more attractive to buyers. So, she's hardly wasted the money. And doing up the flat will make her more comfortable.

When she becomes less mobile (which is inevitable with age), she'll be able to enjoy looking at her nice environment than staring at peeling wallpaper in colours she hates. It's an investment in her current and future metal wellbeing.

Nothing about your posts convinces me that you are genuinely concerned about your mother and not just eying up your 'inheritance'.

Stop thinking about the money and enjoy the time you have left with your last remaining parent. Take lots of photos together. Record her speaking to you. You'll treasure that so much more than £150k when the time comes and you end up an orphan. Don't fall out with her over something as inconsequential as money.

Families are not obliged to cover care costs for their relatives. I would get some legal advice if this is the case because local authorities can only assess care fees based on the savings/assets and income of the person actually going into care. Anything the family may want to ‘top up’ to enable a better care home or extra services is purely voluntary.

Yep. People confuse the seven year rule with a similar thing affecting inheritance tax. Local Authorities can go back as long as they want when investigating potential deprivation of assets and as you say, apply to the courts for dissolution of the trust to recover care fees.

The council don’t recover the fees from the estate. They put a charge on the property and the person going into care enters into what is effectively a loan agreement with the local authority -it’s called a deferred payment agreement and attracts interest and arrangement fees. If the property isn’t sold until after the person in care passes away, the LA can effectively force the sale for less than market value to recover fees if it isn’t sold within an agreed time frame.

Sorry, you are wrong about putting a property into trust to avoid care fees. It’s a deliberate deprivation of assets and the council can apply to have the trust dissolved. And there is no 7 year rule on d of a.

This is not correct. Families are not liable for their relatives care fees at any point - it is the sole responsibility of the person going into care. The local authority will look at your age and overall health, and whether you could reasonably have expected to need care at the time you ‘disposed of’ the funds available. Doesn’t matter what you spend it on - if you burn through money which could reasonably have been used for care it will still be viewed as deprivation of assets and the local authority will carry out the financial assessment as though you still have it.

This happened to a relative of ours - he was assessed as in possession of almost £150,000 - he had actually wasted it all in less than a year and the LA refused to contribute to his care until he fell below the £23,500 threshold at which they start to pick up some of the costs. This meant he had to sell his property to meet the fees, which probably wouldn’t have been necessary had he not thrown caution to the wind and gone on a spending spree.

No but if she is still spry her chances of being one of those 90+ year olds is quite high!

I have 2 aunts who have been on cruises (Iceland and Norway to see glaciers, volcanoes and such as day trips - not sitting on a lounger - at 93, one is always off on coach-based holidays in the UK at 93, one went to a wedding in the U.S last year...

If the value of her flat would cover a few years of care home fees (it sounds like it would), I would encourage her to enjoy the money whilst she's fit and well enough to. The council will just put a charge on the property and pay the fees until the flat can be sold (after death if necessary), then reclaim them from the estate. When she's down to £23k (or £26k, I can't quite remember) the council will pay the fees. Even if there's a top up to pay, that can come out of the £23k that's left.

Apparently the transfer into trust thing doesn't work any more. Age Concern has some useful information about deliberate deprivation.

Im firmly in team 'spend it and enjoy it'. Good for her!

I have elderly relatives who I wish would spend more money on themselves, but they seem to just let it accumulate for years. My uncle has a good civil service pension, and tens of thousands in his account while wearing old clothes with holes in them, or relying on crappy hearing aids that don't work. I despair. He will not listen when we suggest he makes his life more comfortable.

My mother has about 50k in cash that she is keeping in a box as 'insurance', not sure what that is for, and many more thousands in her accounts that she won't spend either, despite the fact that her house is getting more and more dilapidated. I wish they were both a bit more like your mum.

People save 'for a rainy day', at 87 years old I would say it's raining now.

One thing to be careful of if she does need state support for care is that they are entitled to go through your finances and if they think you have deliberately deprived yourself of funds so as to come under the threshold for state care that can affect what you are offered as support (not sure exactly how).
So putting money aside in a trust, or burning through it quickly would both cast her circumstances in that light and not go down well.
It might be worth checking out the details on that so as to not inadvertently create a situation.

I would be tempted to go down the “l will only tell her once”route with this. It’s really easy to say she won’t be going into a care home but none of us know what is around the corner. Especially if you don’t want her to move in with you / she expects you to pay her care home bills

What 'financial trouble'? Maybe a less nice care home. But that's it. She has a flat anyway still and OP's worries are about care not daily spending so she probably has enough for that.

Also I hope to God I won't ever need care but if I'm lucky enough to reach a ripe old age after working hard all my life. I'd enjoy, and live on toast for the rest of my days if it came to that. I'll be dying eventually anyway. Being alive, but barely able to do anything, regretting not taking the chance is far worse than saving for something that may never come.

I hope I have not misunderstood the OP

My feelings:

Let mum enjoy
Re care home fees - as long as she has not deliberately deprived herself of assets and they cant prove otherwise, she is ok.

The downside is, if care home was ever required, you do get a better care home in the private sector but her 150k she had would not have gone far as costs are very, very high, well where we live they are/London

Also realistically what are going to do? She is an adult and can do what she wants. As you said she doesn’t have dementia.

She is 87, let her live! She decorated her flat nicely surely that will now last her for the rest of her life. She doesn’t need to redo it all again in a few years I assume. Are you worried she is spending your inheritance?

my dear relative died before she even turned 80 after a horrific accident and spent the last 6 weeks of her life in pain, agony and slowly dying. Life is for living you never know how long you have got.

she could live another 15 good years yet, a long time if she runs into financial trouble.

Let her spend it.

similar circumstances- mil was financially abused by her husband for years. Finally sold her house, downsized, and had cash burning holes.

she had a wonderful 3 months shopping, spending, treating her children, before suddenly dying.

i’d hate to think that joy and freedom of doing what she wanted was curtailed by “saving” for future care.

My best friends partner always says his mum did the right thing and spent her money on cruises, as both friends mum and MIL are receiving in home care, both only early 70’s. One getting it paid for by the Government, one paying herself. I say let her spend it, she’s had years of having to ask permission and I don’t blame her one bit for splashing out now. Enjoy!!

I think you’re right to have some reservations but ultimately I think it’s lovely that’s she got a lovely flat which she’s spent money on doing it up to a nice standard to make her life comfortable. She may never need to go into a care home and there are always solutions even if she does.

my Nan downsized after my grandad passed away many years ago and spent money on living her life. Her biggest fear was not being able to stay in her own home. She never went into a care home and passed away at 95 after being fairly independent the way she hoped she would.

conversley my MIL is currently in a care home after a series of falls, she had no savings and lived in a council property her entire married life so had zero assets to pay for her care. She is placed in a local authority funded home and has absolutely thrived there

She has basically been told that the nhs won’t cover his care, and once the families savings are rinsed, it’s on them. So it may fall onto you

This is a nice story but what your friend has told you isn't true. This doesn't happen and there is absolutely no requirement for family members to fund their relatives necessary from their own pocket.