Concerned about MIL lack of pension

[CherryTTT]

I’m a long way off retiring (20 years or so), but a meeting with a financial planner just got me thinking about how much more I need to put away into my own pension pot. It’s a lot!

MIL stopped working 10 years ago at age 55. For no other reason than she no longer wanted to work for her boss. I think she thought she’s find another job, but was in quite an ageist (beauty) industry, so didn’t manage to get a new one.

She hasn’t had a mortgage since 1998 and has continued to buy expensive clothes, beauty treatments and go on lovely holidays throughout this time. There has been no change in her lifestyle at all since she stopped working. She is a busy social butterfly and has lots of friends and fun, which is great.

I didn’t really think much about it (as it was none of my business) until the past 3 years when DH and I have had to pay for her new boiler, new heating system, roof repairs etc. We had just handed over £8k for urgent works when she went on a £6k holiday 2 months later!

She recently started dropping hints about another big bill she has coming up and just before I was going to mention to DH that we should perhaps pay it for her, she started telling me about the holiday she wants to go on to Mexico in November!

I’ve now told DH that we won’t be helping out financially again. We’ve got our own DC and house to support, as well as our our retirement planning and if someone can’t be frugal themselves, they shouldn’t be expecting handouts from others.

My main concern is about what happens when she is too frail to live alone or has frittered away whatever savings she has left. Her house is worth £300k. Nursing home fees in this area are £1000 a week, so with inflation, her house would cover 5 years of care at most.

What happens after that? Would she need to move from a private nursing home to a state one? I’m thinking what would happen if we couldn’t afford private school fees any longer, our DC would need to move to the local comprehensive.

Does anyone have experience of this?

PIL are a long long time divorced and FIL is still working. He’s made sure he’s got his own pension to support himself in own age. My own DP are self-employed and have private pensions, as well as business assets to rely on, so this issue is only concerning MIL.

How has this woman made it your job to be responsible for her finances?

You say you will take her to your financial planner, why does she need so much hand-holding?

Why have you and DH taken the role of being financially responsible for her? She's not your child...

Outrageous, and you're playing along with it

If she was born in 1953 she only got state pension in 2018.

Did she get a big redundancy payoff? Did she have a private pension that she has drawn down? Did she get loads of cash from her divorce?

In any case it is not reasonable for her to expect you to support her in this way, not while she is splashing out big time.

You and DH have no right to pry into her affairs, but if she is hinting about support it is reasonable for your DH to ask her in general how well she is set up to manage the next 20 years if she can’t afford house repairs.

If she had a great career and was a director, how is it possible that she didn't have a private pension? You're allowed to start drawing your pension 10 years before state pension age so perhaps that's how she's funded her lifestyle.

I’m thinking what would happen if we couldn’t afford private school fees any longer, our DC would need to move to the local comprehensive.
The horrors, one of the most middle class comments I’ve read 🙄🤣
On the other hand I would do a budget and plan with her or maybe she’s took all the ££ out her house.

65 is not ancient, doddery or in need of hand holding over seeking advice / making a plan. Most 65 yo now will expect to hold down responsible jobs at her age. If she ran a business she has financial nouse, surely?

She's got your DH well trained. Talking about paying care home fees!

OP a lot of fuss and concern but you don’t know what or where her everyday money comes from or is.
Surely that’s the starting point of the conversation?

@BarbaraofSevillle Fair enough, but there's a big difference - in receiving state pension terms - between being just 65 and 65 almost 66. I was 65 in January and my pension started in May. (My neighbour is a a whole 11 days older than I am, and got her pension 2 months before I did.)

A £6000 holiday. Well that says it all. You must not fund her any longer.

Yes, you're right. My DM is just under a year older than MIL, yet MIL doesn't get her state pension until nearly 3 years after DM did, even though there will be a short period in a couple of weeks, when they're both 65.

But for the point of this thread, there's still about 8-10 years between the OPs MIL stopping work and her state pension kicking in, or she might not even have it yet, depending on how exact the phrasing 'stopped working 10 years ago at age 55' is.

Instead of spending £6k on a holiday she could stick it into an ISA and earn about 2.5% p/a.

What sort of holiday costs £6k for one person? Or did she pay for others?

I would have thought you'd be looking at a max of £2-3k for 2 weeks of quite a high end holiday (Caribbean etc?)

I clearly don't know how to live.

Gosh I'm 67 living on a state pension and a very small occupational pension, I think I'll ask the Dc's to pay for the new boiler we need!

I don't really see what's wrong with selling up to free up capital and then renting. Your pension will go up by CPI if you're lucky, your savings will not keep pace with CPI, but your rent will increase by CPI plus some.

My MIL aid widowed and owns her own home - state pension plus six figure savings account and occupational pension. Her holiday by way of comparison are self catering Cottages cost about £600 p/w. This lady has extravagant tastes way beyond her budget; maybe her former life has given her airs and graces - but that's just tough shit and she needs to budget for the real world not have others subsidising her fantasy lifestyle.

How do you know she doesn’t have a pension?

She might have one but just keeps taking the piss out of you!

Sounds a bit Hyacinth Bouquet / Margot Leadbetter.....keeping up appearances.

@HollyGoLoudly1I am lucky enough (entirely because of the sacrifices my parents made to enable my career) to have good pensions etc and not to need anyone to fund my retirement.

@Tinkobell You are completely wrong there, and it is quite insulting. My parents never saw me as an investment. They wanted the best for me, as we all do for our children. They did not know then that they were going to end up with financial problems in later life (not of their own making). They don't expect anything from me, just as my decision to look after my stepdaughters and fund their educations was nothing to do with their expectations and everything to do with what I wanted to do. But what kind of a human being would I be anyway if I allowed my parents, in their eighties, to be entirely without means in an essentially third world country?

And by the way, my choice of career was entirely my choice, I knew what I wanted to do from the age of three and never changed tack. No-one ever tried to convince me in to it because it is well-paying, as an "investment". If I had decided to do something else my parents would have supported in that as well. I have two siblings, they did not go into the same kind of lucrative careers, and no-one ever tried to make them...

Sorry to hijack the thread with my own story btw, I just wanted to point out that families have all kinds of different arrangements, there is no way things "should" be.

I’m the same age as MiL - born August 53 and got my state pension in November 17. She must have an occupational pension of some kind to fund the kind of lifestyle she has.

OP, I really wouldn’t worry too much about care home fees. It will probably be 20+ years before they become an issue and most people spend a couple of years in one at most. At today’s rates, her house will keep her going for at least five years.

You do need to stop being her ATM though!

DH did reference about 6 months back about our expenses not going down once our DC have grown up. Something about care home fees

Taken together with what you've already spent, I'd suggest that if your DH sees nothing wrong with continuing to fund her so lavishly, you've got more problems here than just your MIL. She's got thoroughly used to the handouts, clearly expects more, and isn't going to give them up willingly

Perhaps a proper discussion with DH would be wise before going any further with this?

Maybe your mother in law has a private or employer related pension. I can't imagine she'd be able to do all she does socially, and have expensive holidays, just on the state retirement pension, even with claiming additional benefits.

It's not fair to expect you to fork out for expensive things that go wrong in her home, especially as she appears to have plenty of money. Might be different if you were exceptionally rich, in which case it would be good to take care of her financially but it looks to me as though you are probably budgeting well and maybe even going without in order to help her.

I wouldn't worry about care homes, not everyone needs that. Neither my parents nor my in laws had to go into any sort of home, they stayed in their own homes. Anyway, if it did come to that she would probably be able to pay for it.

It seems strange to me for parents to expect financial help from their children, mine never did - it was the other way around.! Now that we are far better off we can help our adult child, couldn't see myself asking for anything really. I'd hate that.

In some cultures/countries it is absolutely the norm for children to support their elderly parents/grandparents. Many of the views expressed in this thread have completely ignored that.

purple I’m well aware of that as I’m sure most posters are. But I think it’s an appalling road to go down.