Selling your home to pay for your care in your old age

[BlueCarnation]

Please explain why this is such an issue? I’m not from the UK but have worked and lived here for about 10 years. The amount of financial help the government provides is incredible and I’m still amazed by it after being here for so long. NHS, schools, SMP, different types of benefits, child credits etc. My country provides absolute no help like that for it’s residents.

One thing I can’t get my head around is the outrage people feel regarding paying for your own care when you’re older. A few weeks ago there was a news special where people were upset that their parents had to sell their homes to go into care. Surely that’s the point of years of hard work - so that when the time comes you have sufficient money? If I recall correctly, a woman said she would no longer be able to live in her mums house and would be homeless. Her mum was already in a care home but needed extra specialised care ( I think she had dementia) which government support was not enough for. The daughter said the house would need to be sold and her mum would have been devastated if she knew her home was being used to pay for her care. Why is that wrong or unfair?

Can you explain if you cannot live safely in your house anymore why shouldn’t the proceeds from your house sale be used to care for you until death? Why are adult children so up in arms at the thought of that? I don’t understand.

@RockingMyFiftiesNot

why do you think home ownership in this country is so much aspired to?it is the idea,you pass on your assets to your offspring.

I have never heard anyone i know, ever, say they have bought a house to pass on assets to their offspring. But I've only lived here since the 1960s so you carry on with your superior knowledge of how we all live and think in the uk

I've also never heard anyone say they bought a house to pass it onto their children.

Buying a house, if your can afford it and raise a deposit, makes more financial sense as the monthly mortgage payments are generally less each month than rental payments then when you've finished paying the mortgage the house belongs to you and your monthly outgoing drop considerably.

I'm old, the last mortgage I needed was for the house we bought when we got married in the 70s.

I've bought several houses since my divorce over 20 years ago, each one was paid for outright. That's an enormous amount of money I haven't had to pay out compared to if I'd been renting.

That's why it made sense to me to originally buy a house, not because I wanted to pass it on to the children I hadn't even given birth to at that stage.

It's only now that I'm in my 70s that I'm thinking about how passing my assets onto my children will benefit them.

TractorAndHeadphones

StopGo
What I object to is the two tier charging policy. Care/nursing homes locally charge between £1000 and £1300 per week to privately funded clients. The same beds/rooms are ‘sold’ to social services for £550 per week. Self funders subsidies the rest. So so wrong
I agree that this is very wrong
Even normal companies selling services don’t give ‘bulk buy’ discounts of over 50%

And expect others to pay for

I don’t think it is about how hard you work but how you spend your money.

If you are in the benefit system, have been lucky to be given a council house and you spend your money on holidays, going out, plastic surgery and then don’t pay and run up credit card bills, loans etc if you don’t own anything then there is nothing to repossess (Friend and her Dh have done this a few times over the years)
Whilst if you save, buy a home and make it comfortable and then fall on hard times. Getting on benefits is hard and any money you get doesn’t pay your mortgage and so it can all go and if you don’t have children then you can find yourself homeless and if you do have children then you can find yourself in one room of a B&B.

It makes you wonder if actually trying to get anywhere is actually worth it.

Also I have paid into pensions when I worked PAYE years ago.
Apparently the company used the pension to pay off debts.
In laws lost there private pension to one of these mis selling scandals

Dh had to cash his in to pay for cancer treatment and to keep us going when he was off work for nearly 2 years.

I do wonder what our lives would have been like if we had just not bothered

@Gooseysgirl

The 'deprivation of assets' is interesting and I wonder if some people still manage to avoid paying for their own care having knowingly done this. My MIL was widowed 40 years ago while DH and his siblings were little. She has lived very frugally ever since (often mentions being 'hard-up' in the early years of being widowed) but has savings and owns her house that's currently worth about £600k. Her view is that if her DH had lived, the kids would have had a better childhood financially and she wants to protect their inheritance... she worked full-time but had to sell his business when he died to make ends meet. She worked full time for over 50 years (ironically for the NHS!) until she retired in her early 70s. She is adamant that if she needs residential care that they won't have to lose the money they stand to inherit. So she signed 3/4 of the house over to them about five years ago. She's now in her early 80s, and other than some mobility issues is thankfully in good health. I sympathise with her view, but all her DC are currently plodding along financially, work full time in good jobs, definitely not wealthy but on property ladder, can afford annual holiday etc. I think there are grounds here for deprivation of assets if she eventually needs care 🤷🏻‍♀️ but she is adamant about protecting their inheritance!

i wouldn't say that everyone who tries to evade fails but as i understand it, if the home owner doesn't have a good other reason for doing the sign over and especially if she pays no rent to live in the house, then her council can decide that it was deliberate deprivation and assess accordingly. Councils have public monies stewardship duties as well as being short of money. They don't actually require the house to be sold but can assess the councils contribution as though the house is still wholey owned by the person. I retired from NHS work 14 years ago and the situation wasn't new then yet it seems that people still think there are ways around it.....which there may be....but just signing over chunks of the house is not one of them!

Different councils will do things differently but when working for one council, I have definitely seen elderly moved to cheaper homes when their cash ran out - this is from private homes to either cheaper private or council run, but up here there aren’t enough council run anyway. In most cases there was the option for the children to top up the difference between the council payment towards care and that care homes fees but that can be a big burden and is not available to all.
My mother pays for care in her home, and has 2 drop in calls for toilet/check in on top of her 4 calls per day - I had to argue hard to keep these and was advised I had to understand that when she stopped paying these calls would be cut as not deemed essential- in a sense they are not as they are not medication or food based, however they’re a lot to do with her dignity and wellbeing.

Because Dementia is a terminal disease like others. But unlike other conditions, Dementia patients have to sell their homes to pay for their care. It's the injustice in that respect that gets my goat.

@godmum56 yep! Remains to be seen whether MIL ever will need care, but I can't see how she would avoid getting caught out with this!

@happyjules

Because Dementia is a terminal disease like others. But unlike other conditions, Dementia patients have to sell their homes to pay for their care. It's the injustice in that respect that gets my goat.

people with other disabilities and illnesses are assessed under the same rules...also they don't HAVE to sell their homes. What they can't do, and neither can anybody else, is preserve their estate to hand to their children rather than using it to pay for their own care. I agree that dementia is particularly awful, but so are parkinson's, motor neurone, MS, severe strokes and many other diseases.

@Gooseysgirl

The 'deprivation of assets' is interesting and I wonder if some people still manage to avoid paying for their own care having knowingly done this. My MIL was widowed 40 years ago while DH and his siblings were little. She has lived very frugally ever since (often mentions being 'hard-up' in the early years of being widowed) but has savings and owns her house that's currently worth about £600k. Her view is that if her DH had lived, the kids would have had a better childhood financially and she wants to protect their inheritance... she worked full-time but had to sell his business when he died to make ends meet. She worked full time for over 50 years (ironically for the NHS!) until she retired in her early 70s. She is adamant that if she needs residential care that they won't have to lose the money they stand to inherit. So she signed 3/4 of the house over to them about five years ago. She's now in her early 80s, and other than some mobility issues is thankfully in good health. I sympathise with her view, but all her DC are currently plodding along financially, work full time in good jobs, definitely not wealthy but on property ladder, can afford annual holiday etc. I think there are grounds here for deprivation of assets if she eventually needs care 🤷🏻‍♀️ but she is adamant about protecting their inheritance!

If she doesn't need care, then at least the value of the house that she has signed over to her children will not be counted in the value of the estate for inheritance tax purposes. (Though does she pay rent on this portion? As I believe she needs to)

What do people think we pay Tax and NI for? Care is not "Free".

In the main I dont understand many Brits - Never happy unless moanily begrudging someone else getting something 'free', or getting ahead in life. & I suppose some who came here from overseas love to assimilate into that mindset.

Stop reading the right wing puppet media that convinces you that you should spend all your good years working (hopefully till you drop) and your pesky offspring (who pay into this country too, its not exactly a wonderful life for them right now either - they can't even get onto the property ladder their parents and grandparents worked to clamber onto) shouldnt inherit a thing, simply work hard to keep the middle and wealthy classes in money and properties.

Surely government paid care is for those that have no money, that's the idea of it.
Otherwise you should pay for your own care, inheritance is no argument.
My Dads care came from his own money and the plus is, you get a bigger choice of places.
We didn't think 'oh, we'll get less dosh when Daddy pops his socks' We just cared that he got good care in nice surroundings.

Roughly £300 billion is going to be inherited in the next decade so those with money and other assets look set to pass most of it down to their dc despite care home fees especially if they have planned well financially.

On an individual basis people are spending £100s of thousands on care in a short number of years and because they have the bad luck of a degenerative illness. Costs are huge on top of what is a very stressful situation.

Whilst self funding is the right thing should we not try to increase funding across the board ?

@ItsDinah

The problem is that if you don't own your own home or other assets, your care will be paid for by the government. If someone is very wealthy this won't bother them. If someone has scrimped and worked hard to acquire savings/house, they will feel hard done by if they have to pay while someone who had similar earnings but did not save does not. This is particularly so as in many parts of the UK, private payers have to pay as much as double what the local authority pays for exactly the same care and accommodation in the same care home. They are in effect subsidising the publicly funded.

This

@BeautifulBirds

Because people who chose not to work, that get handouts all their life, thanks to my hard work and my relatives hard work. Then at the end of life get the same level of care that costs my family £1k a week, for free! That's why I get cross.

And to make it worse, this money will subsidise the care of those who cannot afford to pay for their own, then when your money runs out, you'll be threatened with being moved to a home with lesser care, because there aren't enough self funders to subsidise you, now your assets have all been used up.

Why should care in old age be treated (funded) any differently than say cancer treatment in a much younger person?

Care isn’t just medical treatment though. The costs of being in a care home include rent for your room, someone to do your food shopping/cooking/serving, cleaning, laundry, personal care. Any medical treatment is on top of that. When my friend had her chemo, she was still paying her mortgage, cleaner, food bills etc herself.

It’s because this doesn’t impact the rich as their wealth is more likely to be tied up in investments / trusts that don’t count as their wealth in this instance; or they have such big houses that they can make any improvements & buy in (cheaper) home care services; or can negotiate much better private rates at far superior care homes. Only the middle classes really pay hundreds of thousands for absolutely shit care

Is the issue not more nuanced than to pay yes or no?
Is £5000 a month my Dad pays per month for just care alone in his own home a reasonable amount? - this is a minimal amount of care required for his needs.
All other bills, cleaning, shopping, maintenance, gardening etc are covered separately or done by family.
He is currently on the last amount of 'home' money which will ran out soon having spent £25000 in 5 years.
As a comparison his care is less hours than a daily child care setting.

hellodulling but why, in that case, don’t people get charged for their food, cleaning, bed etc when in an NHS hospital? There’s no difference in principle. It’s just down to location.

I think there needs to be thought into where the money is going and not just where it's coming from.
Care home fees cover the basic costs of living - a roof over your head, food, gas, electric, cleaning, maintenance, bedding, towel, TV licence, gardening, security and then for care and maintenance of things that are needed to care - staff (and the costs they incur like DBS, tax and NI, training, uniforms, PPE as well as wages*) equipment like hoists, stand aids, slide sheets and profiling beds and the extra electricity to run the ones that rely on it, maintenance of them, replacement, replacing items broken and ruined by residents due to their needs or behaviour like chairs, tables etc.

*I'll just say that not all but many companies expect staff to buy their own DBS, uniform and don't pay for training, some I have heard charge staff for training (though that's never happened anywhere I've worked).

In theory, the more you pay, the better care you should get because there should be more staff, better trained and paid, more equipment that's better, better food etc. But every home has to meet the needs of their residents, maybe room 3 doesn't need a hoist now, so why are they paying towards it? But what if they fall and need it for a few weeks - should they then pay more? Or should the home use the hoist they already have anyway and should they have these things regardless because a high proportion of residents will need one at some point?

What I'm saying is that does all the money that's being paid by self funders and LAs go towards care and there's a shortfall so the costs aren't being met? Or are we funding bargain style care to maintain company profits?
I know one thing, the workers delivering the care aren't getting a very good deal either, especially when they're paying for the essentials to do the job themselves out of minimum wage and the residents aren't getting much of a good deal if they're paying more than the LA will but recieving the same care.

Ultimately though, funding everyone for free social is going to cost a lot more in the way of tax than we pay now, which will be ok for the higher earners, not so great for people like me who can barely survive on what I earn now never mind with more taken off.
I don't know what the fairest answer is, but I don't think any model of funding will ever be truly fair for everyone.

I've worked my whole adult life to buy a home for my children - and I've paid tax on every single penny I've earned and spent.

Damned if the government are getting my house to pay for my care (if needed). My house is going to my children. I will be signing it over to them when they are slightly older. If you have a clever accountant you can avoid as all this nonsense.

@Narutocrazyfox. and many other people work really hard,pay their taxes and never manage to get on the property ladder.

@emmagrundyforpm I feel for anyone who wants to get onto the property ladder but can't. But what's your point?

The op was talking specifically about selling your home to pay for care. Something I'm (along with many others) am not prepared to do.

Narutocrazyfox I think the point is someone has to pay for it, if those that can afford to don’t then it falls on younger tax payers to pay for it, many of whom will never be able to buy their own home.

@stairway By the time I retire, I will have paid into the system for around 50 years - my care will certainly not be free!

You've highlighted a very important point - many young people will not be able to afford their own home. Precisely why my home will go to my children.

[quote Narutocrazyfox]@emmagrundyforpm I feel for anyone who wants to get onto the property ladder but can't. But what's your point?

The op was talking specifically about selling your home to pay for care. Something I'm (along with many others) am not prepared to do.[/quote]
This isn't a snarky question, I genuinely want to know, where do you forsee the money coming from to fund your care and everyone else's who want to leave their homes to their children instead of paying for care?
And it's not really the government that gets it, people like me get some for delivering the care (should we expect people to deliver care for free and if so, what do they live on?) The rest goes to a private company that arranges delivery of the care, (though they do pay tax so the government gets some of it) and the costs associated with that - and of course, profit.