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.

Regarding costs of care

I did a rough calculation, a lot of the cost will be paying for the care home itself

So rising house prices lead to more expensive care

@ChristmasKrackers

You need to be stinking rich or very poor, those in the middle get caught out.

This with bells on. We have very little left over at the end of the month despite being in what looks like reasonably paid professional jobs. I have friends on v low incomes (deliberately) who get housing benefit, carers allowance, maintenance from ex spouse, pip, various other bits and bobs and have a lot more disposable than me. They keep their salary low in order to receive the benefits. My house is my only collateral. And I want to pass it on to my children. I have never had financial support from my parents and it's eaten away at me (they could have afforded to help us out a bit but chosen not to). We're the only ones in our friendship group who've had no help at all. We pay 40% and 50% tax on our incomes respectively plus national insurance. Damn right I don't want all the equity on our house to be spent on care. I want it to go to my kids.

Thursdaymiami

The NHS does pay from cradle to grave
For medical care
Honestly i think some people really are low in comprehension skills

I think there was a missing line not because people’s comprehension skills are at fault

It should read

Thursdaymiami

“The NHS does pay from cradle to grave
For medical care.
As long as you are in the right postcode”

@CraftyGin

Some people live their lives as net recipients of welfare, others are net contributors. Is this 'fair'? Not entirely - there will always be a proportion of people who are not willing to help themselves.

I don't see how this changes when these people move into care homes - the net contributors continue to contribute and the net recipients continue to receive.

Poor people tend not to live anywhere nr as long as wealthier people, so your work shy layabout, drinking and smoking his/her life away on diet of take aways, wont be costing us (in old age) much at all.

Where as your tax avoiding millionaire/billionaire, is costing us all a fortune.

@LuluBlakey1 totally agree with you on the bill and care home costs.
From my experience many homes provide food that's so cheap it like a 90s school dinner, just a tv for entertainment/ no brain stimulation so the dementia is bound to get even worse and are about as homely as a hospital ward all for the cost of over £1000 a WEEK. Many staff are on minimum wage or just over (scandalous as it's a really tough job and you have to be so patient dealing with dementia every day). The owners must be raking it in!

@Chely

Many sign their houses over to their children to avoid this. Work hard and pay taxes for most of your life then have to sell your assets to pay for care. A person who paid little to nothing gets the same care free of charge because they have no assets.

it doesn't work. its called deliberate deprivation. www.ageuk.org.uk/globalassets/age-uk/documents/factsheets/fs40_deprivation_of_assets_in_social_care_fcs.pdf

@Chely

Many sign their houses over to their children to avoid this. Work hard and pay taxes for most of your life then have to sell your assets to pay for care. A person who paid little to nothing gets the same care free of charge because they have no assets.

But you don’t. Being able to pay yourself gives you choice. When the state pays, you have to access what is available at a price that social care is willing to pay. When you are paying yourself, you can choice where and what services you want your care to involve. It is in no way the same

Your words, Octavia

So how will it work in our case? We have a flat, no mortgage, probably valued at £190-£200K due to a short lease (long enough to outlive us but classed as short). DH is older than me so what happens if he needs care? Is a charge put on the flat for his half and the rest pays for my care? I'm presuming I won't have to sell it to pay for his care, or vice versa.

This is in large part due to a misunderstanding of how taxes work.
The working generation pays taxes to fund the older generation at that point in time.
Funding etc determined by how long people lived.

The current situation is a double whammy of:
a) A huge generation of elderly people (the baby boomer generation) needing expensive care off the back of a relatively smaller working age population.

b) More people in said generation living 20-30 years longer than predicted.

There's no point in saying that 'X Y Z' used to be available in the past because the demographics were different.

@MargosKaftan

I always feel the need to point out on these threads that it used to be free. My grandfather had dementia, he went onto a geriatrics ward when he was too far gone for my grandmother to cope. There were care homes, but as discussed, they were expensive and for posh people.

When he died (late 90s) he was one of the last on the ward, which shut down shortly afterwards. Because instead, you were offered a care home place for your relative funded entirely by the state. Why wouldn't you accept the posh option for free? Then once all the NHS long term care wards shut, suddenly it was why should the state pay for your care homes and your house had to be sold to cover it.

There used to be a free option for everyone. It wasn't as nice. Those who could often went private. But that was a choice.

I used to work in those NHS wards. Unless you were lucky it was parking people to await death...and care homes have not been free since at least the 70's (when I started working in the NHS)

The argument about working hard all your life for the government to take it from you is flawed. Firstly it suggests only those who have been fortunate enough to be able to buy a home and benefit from house price rises have worked hard, when it is perfectly possible to have worked equally hard but been unable to buy a house.
Secondly the government are taking nothing from the person needing care who is merely selling one home to afford another. They no longer need their home so it is not unreasonable to sell it for what they do need. The only losers are the children hoping to inherit a free house, which they most certainly have not worked hard for.
I have no problem in paying tax to fund care, but don't see why tax payers should fund care so that independent adult children can secure an unearned windfall.

The main problem is that the system is inherently unfair.

Let's say someone has rapid decline dementia. They spend 18 months living with family, and then it is unsafe to do so.

They have sold their small property, worth £100,000 which they worked hard for and wished their child to inherit.

They have pensions and attendance allowance of about 1000.00 per month.

Before they can access any assistance, every penny of their capital has to be gone to a threshold of around 23,000. At this point an assessment is done. If it is decided that any capital has been used when there was a reasonable expectation of residential care being required, it will be regarded as deliberate deprivation of assets and contrary to popular belief there is no time limit on investigation, and if POAs are involved, criminal proceedings can be instigated.

Between the threshold of 23,000 and I think 13,000 the local authority will calculate an amount to be paid on top of all pensions until the lower amount is reached. After that they just keep the pensions. I think the logic is that it's enough for death related expenses.

CHC funding is not paid even if a dementia patient is non-verbal, bed bound, at risk of weight loss and bed sores and needs to be turned every two hours. People can last years in this state due to the diligence of a good care home.

Meanwhile, 18 months of caring for a person has taken someone (often, but not always, a middle aged woman) out of their career, reduced their employment prospects and being paid around 65.00 a week for the privilege. Carers could not be paid for because someone with dementia, while they are deemed as having capacity, cannot be forced to have them, and a care home is a feared prospect, and the family carer would have to be stone hearted not to step up.

It is the people with the smallest assets that suffer most, and where a cap would help.

It should also be remembered that smaller inheritances can help boost the economy by helping people "level up" at certain points in their lives.

It's complicated, emotive and needs an overhaul top to bottom.

@Turkishangora would you want to swap with your friends & be in a position to receive carers allowance or PIP?

This is in large part due to a misunderstanding of how taxes work.The working generation pays taxes to fund the older generation at that point in time.

yep

Care home costs are ridiculous and they line the pockets of care home owners. No one should make a profit from old age care- it should be provided at cost by the state so that those who use it are paying for their care not paying to fill the bank accounts of care home owners.
It does not cost £1100 a week to feed and provide a room for and a carer for an elderly person- who might spend most of their time sitting watching tv

You need to watch the Care Crises with Ed Balls. It absolutely does cost that, and most care home owners live pretty normal lives. They aren't living a live of luxury.

The argument about working hard all your life for the government to take it from you is flawed. Firstly it suggests only those who have been fortunate enough to be able to buy a home and benefit from house price rises have worked hard, when it is perfectly possible to have worked equally hard but been unable to buy a house.

This prevailing attitude is so depressing.

It’s awful for social mobility. Rich people manage to hold on to their assets and pass them to their children. The entire value of poorer peoples houses goes on care.

It's this. Housing is often the only asset less wealthy people have to pass on, passing it on can make a huge difference to your children in terms of social mobility.

For richer people they have other assets and care is a smaller proportion of their incomes, meaning they continue to pass to children.

I’d be annoyed if I’d worked hard all my life to repay my mortgage and had to sell yet someone else who had never worked was getting the same care for free. That’s why people get annoyed.

You need to watch the Care Crises with Ed Balls. It absolutely does cost that, and most care home owners live pretty normal lives. They aren't living a live of luxury.

This is sort of not entirely true. The care sector was quite heavily targeted by private equity, which strips assets and loads up cost bases of this sort or business.

Old people will just splurge their savings on cruises etc

How very dare they.

It's this. Housing is often the only asset less wealthy people have to pass on, passing it on can make a huge difference to your children in terms of social mobility.

But it perpetuates the problem & makes it harder for those without this help to ever afford a house

It's not just the lazy, work shy scrounging lay abouts that can't afford to buy their own home to fund their social care. I can't, and I can't because I work in social care for the pittance we're apparently worth, and I'm single so no one to share the financial burden of life with.
Now before anyone pipes up with "Get a better paying job then" if all care workers do that, doesn't matter who's paying for what as there'll be no social care, we need low paid jobs like this, society relies on them, and if they're not paid enough to fund their old age then it'll need to be funded - you'll pay for it one way or the other because the stark reality is that the true cost of care (including paying those who deliver it a wage they can do more than survive on) isn't being met.
The problem is that anyone who doesn't own their own home is seen as a feckless waster or a work shy scrounger and so people get up in arms about having to sell their hard work to fund their care (paying more if private because the LAs don't pay enough) and can't conceive that the person in the next bed might have been just as hardworking but not as valued financially for that hard work.

That said, the system is shit. We've got private business at the heart of it and the aim of private business is to make money, we've got LAs paying as little as possible because they don't have funds and the shortfall and profit margin has to be made up somewhere, so it's put on self funders.
If we were to fund all social care, for everyone, we'd still all be paying because taxes would be higher, but maybe the cost would be more evenly split, though those with higher income would obviously pay more. Whichever way you look at it, social care needs to be funded, through the combination we have now, or through ensuring that everyone is in a position to buy or save (so increased wages in industries like care - more tax) or funding it fully - with more tax.

Of course people like me without the means to pay for my own care could just drop dead at retirement, because we've worked a lifetime making sure other people get care for a pittance. Sure that'll appeal to some on here!

[quote ronniz]@Turkishangora would you want to swap with your friends & be in a position to receive carers allowance or PIP? [/quote]
I fully agree that people who are entitled to benefits should receive them. I just don't think the way the system is assessed is always that fair. There's no way we could afford private school. Yet I know of at least 2 people whos kids have bursary places due to the parents being on a low income. They could work more but choose not to as it means they'll be worse off.

Someone upthread was concerned that their home would need to be sold if their DH went into a care home. The spouse can always stay in the family home with no financial contribution from spouses savings. Not sure about unmarried couples, siblings or adult children (unless they are fairly old themselves)