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AIBU?

Share your dilemmas and get honest opinions from other Mumsnetters.

Original poster

To think many people would be better off not buying a house or saving for a pension

68 replies

Shazziedazzie · 27/10/2015 07:05

My DM worked very hard to buy her own house and saved for many decades for a pension. Now she's retired its a real struggle to maintain her house, its like a money pit and costs 100s or 1000s each year to replace things. I've had to loan her the money for roof replacements. As she saved just a bit, she doesn't get any pension credits and is only a few pounds a week better off vs pension credits. So she should of just never bothered to save for a pension!

He neighbours next door never bought the house, she has it all maintained by the council and is even having a new kitchen fitted soon. The HB still covers all of the rent even though she has two spare rooms as she is retired. My DM is significantly worse off because she bought the house.

Aibu to just give up saving for a pension and just spend my house deposit money? Looks like a pension is only worth it if you can save a lot.

OP posts:
TheHouseOnTheLane · 27/10/2015 07:07

YANBU. My sister regrets ever buying her council house....she is now against the very idea of it and says had she been older and wiser, she'd not have done it.

BUT. Not everyone has the security of a council house and fewer and fewer ever will now they're all being sold.

verystressedmum · 27/10/2015 07:25

If someone has council house then they probably don't need to buy, but if not then they would need to rent.
The rent may be covered by hb but it's not secure.

Stanky · 27/10/2015 07:27

Yanbu. You'd think that hard work and being sensible would be rewarded. My grandma was the same, she always worked hard and saved. But the old neighbour who pissed all the money away, and enjoyed herself down the bingo every week, was far better off. If you own your own house, and you need to go into a care home, they'll make you sell your house to pay for it. It doesn't matter if you worked hard all your life. Unless your family is very wealthy, then you can't win.

ssd · 27/10/2015 07:27

I don't have any sympathy for people who buy council houses, they knew what they were doing.

Savagebeauty · 27/10/2015 07:29

Can she sell her house and downsize?

Abidewithme3 · 27/10/2015 07:34

Yes downsize and have some money in the bank.

CatMilkMan · 27/10/2015 07:36

YABU! Why should your mother provide for herself when she could rely on someone else and have a bit more money? Absolutely pathetic!

WhoTheFuckIsSimon · 27/10/2015 07:37

But not everyone has the option of a council house to rent.

Id rather buy than have the insecurity of a private rent.

ClashCityRocker · 27/10/2015 07:39

I worry about that with my DM.

She is on the lowest rung of the housing ladder and has a small pension - less than 2k per annum.

I suspect she will go down the route of equity release - which obviously, I would much rather mum have a better quality of life than any inheritance. Although I will make sure she gets proper financial advice if she does choose to go down that route.

But, she will probably have more money that way than if she had just saved the money instead.

x2boys · 27/10/2015 07:39

i had a mortgage we were living in a cramped two bed flat with no storage crap heating ,boiler on the blink and no money to do the repairs i,m now in council i dont have to worry about repairs i,m getting a new roof and new front and back doors having a mortgage isnt all that yanbu.

Original poster
Shazziedazzie · 27/10/2015 07:39

Its easy to say downsize, but that costs a lot firstly and you need the cash to afford that and also there isn't anywhere nearby that is smaller! Where are all these places to downsize to?

OP posts:
Scoobydoo8 · 27/10/2015 07:43

Well it depends where she is, had she bought a house in London she would be retiring to a twee cottage by the sea AND having lots left over.

Bad luck really.

Everyone concentrates on the money made as house prices increase - that isn't the case everywhere.

LuciaInFurs · 27/10/2015 07:44

YANBU. I worked for a housing association and all the senior staff would say that once they were older they would spend all their money on trips around the world, sell their homes and present themselves as homeless for the local council.

My friend's grandmother is in a nursing home and had to sell her home to pay the fees. The woman in the bed next to her has never worked and has a funded stay.

OwlinaTree · 27/10/2015 07:48

Hummm I can see why your mum must be finding it hard to see her neighbour in a 'better' situation.

As regards you though, you would be very foolish not to be contributing towards a pension. Who knows what the situation will be like for pensioners in 30/40/50 years time?

I'm confused about the roof replacement thing, I though home insurance would cover that sort of thing (panicking slightly now at though of replacing roof costs!)

I'm on the fence about buying a house. Me and dh have bought but obviously the bank own most of it at present. The main reason we went for it is security. If you are OK about moving round you could stick with renting.

The possibility of needing old age care is part of all our futures, and we all need to consider how we are going to pay for that.

MidniteScribbler · 27/10/2015 07:50

I'd rather own my house. But then I'm not from the UK and I find this expectation of the government to house you to be a rather absurd one to me.

Limer · 27/10/2015 07:54

Insurance doesn't pay for maintenance/wear & tear.

Surely your DM can sell her 2-bed house and buy a 1-bed flat? Or even rent one? Then she could spend some of the proceedings.

JeffsanArsehole · 27/10/2015 07:56

What a load of rubbish. Property has gone up by over 400% in her lifetime. Of course she could downsize, move areas and have what £200-£800k in the bank?

The council houses near me that they paid £62,000 for (at a 70% discount) are now worth £700k. And that's only 17 years ago.

Property has far outstripped any other investment.

And people are wrong about the 'fully funded care'. It's not a level playing field and if you contribute more to your own care you get far better facilities. The council only pay up to £425 a week in my area, decent care homes are £600 plus. My SIL's an adult social worker and they move you out the area or only put you in the posh homes until a cheap one that's within council budget becomes available.

VulcanWoman · 27/10/2015 08:01

I agree about the downsizing. Yes there will be fees involved but there should be plenty of cash leftover at the end to pay this, I'm sure the bank could help with a small lone if necessary.
Regarding the comments about selling the home if a care home is needed in the future, there's the option of renting the house out to pay towards care home fees.

Penfold007 · 27/10/2015 08:06

YANBU amongst the clients I work with the most secure group are those living in LA/HA properties and claiming benefits or even better a state pension plus pension credits.

Your DM is currently living in a three bed house with all the expense and stress that entails. An option maybe to approach a HA that has retirement properties an apply for housing as a self funder. Sell the house, move into flat and pay rent out of the profit.

PlayingSolitaire · 27/10/2015 08:08

For you, I wouldn't rely on the situation in 30 odd years being as it is now. The easy(er) ride for pensioners won't last forever- when we become pensioners, I'd be surprised if we were allowed extra bedrooms, pension credits, no licence fees, fuel allowance, free bus passes etc etc. The state pension won't be enough except for basic hand to mouth living (and probably not even that). You need to prepare and safeguard yourself against a future with no help for pensioners.

echt · 27/10/2015 08:09

Its easy to say downsize, but that costs a lot firstly and you need the cash to afford that and also there isn't anywhere nearby that is smaller! Where are all these places to downsize to?

So true. And Hmm to the poster who suggested downsizing so glibly. If there were so many one-bedroomed flats available, the bedroom tax wouldn't have fallen on its arse.

Also, moving house in older age is no larf. Far-sighted councils bust a gut to keep the elderly in their homes: it's cheaper to upgrade with handrails, stairlifts, etc. Oh, and they don't die quite so soon.

Hang on.......

iwantgin · 27/10/2015 08:14

Not all ex council housed are valued at £700 k.

In my area they don't go over £150 k.

The rung below that would then be small terraced houses perhaps at £90-100 K.

So yes, downsize, but not all areas have had such vast increases in property prices.

Lunastarfish · 27/10/2015 08:17

I rent, I'm about to move for the fourth time in five years. I have a 3 month old baby now so moving is a pita. However, I have the benefit of not having to pay for the boiler/washing machine /ceiling collapsing (all have happened to me).

The idea of buying a property for most people is security and as an investment - you sell the property to fund your retirement/care costs.

I can see why you think it is unfair but not everyone can get council housing, not everyone can get a mortgage and not everyone has good landlords. The answer to your mum's situation seems to be to sell her property and downsize.

NicoleWatterson · 27/10/2015 08:17

I'm still intrigued how generation rent will be housed when we are too frail to work (let's face it retirement is a long gone dream). There's no way we can save enough (if we could save that much we'd be buying somewhere!)

d270r0 · 27/10/2015 08:20

Shes not worse off. She owns the house. If she now sells it she'll have loads of money. If she had rented all these years then the money would be gone. Putting into a mortage is like saving, renting you'll never see the money again. If she is finding that particular house too hard to maintain, she can sell it, if she hasn't got the cash needed to move she can rent in the meantime and that will give her plenty of money to downsize, maybe to a modern little bungalow that is easy to maintain.