How much is enough?

[Blueskybird]

Whist around the table with girlfriends recently, a question came up about parental finances, long term care and costs, as one of our group is considering her mothers future. Another of the group asked how much she had in savings (as in her mother) and she replied sheepishly apologetic, “ not much, about 100K. I was fascinated at the groups reaction, two were of the opinion, well that’s ok for a while, One was, my god she’s got nothing. Another was, ooh worrying! And another, she’s loaded! It got me thinking when do we consider we are not too badly off? It’s seemed such a vast scale we are all of similar backgrounds.
I can remember a time when I had my first job when if I wasn’t overdrawn at the end of the month I was ok. Now it’s if I can the house going for months without a job. At what point do you sleep at night? What is reasonable?

If £100k is her pension pot, then it's not much, but if that's savings alongside her pension it's loads.
Also depends on mother's age.

Given there are many people who are overdrawn every month and most likely still working passed pension age her mother is doing extraordinarily well.

Sorry should have said, mum is late 70’s and the 100k is her cash account.

In my job I regularly come across older people with 100k in their bank accounts but they are still fretting about heating bills and trying to claim any benefits they can and asking for benefit checks ! I guess in the grand scheme of things 100k isn't much, it would buy you good nursing home care for 2 or 3 years, it could rapidly dwindle.

Also there is no way I could ever build up 100k in savings before I retire unless I inherited money but I do think a lot of pensioners live frugally and build up savings after they retire.

… And in the real world most people won’t have anywhere near that much in savings.

100k in a savings account I’d class as very well off personally.

Depends on the level of care for an elderly person. Standard care for someone old but well is low, but for old and 24/7 is high and for nice care home 24/7 would burn through that in a couple of years.

It depends on how cared for you want to be.

It’s impossible to say. Does she own her own house? Does she have other assets? How much is her pension? Does she have any dependents? What lifestyle does she have or want? It won’t get her far on round the world cruises every year, but if her pension covers all her regular outgoings and expenses, it’s a reasonable cushion. Who knows if it will cover care costs, because it’s impossible to know what they might be.

DM is early 80s and has about 60k she lives well within her income so it will go towards care costs or nursing home fees if needed
I don’t think a lot of people understand how the financial assessment process works for contributions towards these charges
DF was in a nursing home for a year before he died it cost around £800 a week plus DB and I paid a small 3rd party top up
As he was classed as self funding he kept his attendance allowance, state pension and private pension which all paid towards the cost leaving him to contribute less than £100 a week
If DM is in a similar position in future her savings will give her at least 10 years care in personal contributions
The system does vary from local authority to local authority and may well have changed by then

Agree that you need to think about total assets. £100k cash & 1million pension pot (or annuity) & 1million house -> rich. £100k cash and paying rent and nothing else beyond state pension-> not so great

My mum has no savings, rents HA and will be paying rent forever. Fuck knows what happens about care when it's needed I'm assuming we'll need to top up.

It’s all relative, isn’t it?

I think it comes down to personal risk tolerance. Some people are content to let the fate’s decide their outcome, some feel like they don’t have anything to lose, and some people want to have the ultimate control over their lives. Yes circumstances and chance play into it to a certain extent, but for most, their actions are going to dictate where they land on the spectrum.

It's interesting how different people see it isn't it. I see 100k as a lot.
I remember someone saying to me once "I'm so skint, I only have 150k in the bank" 😳

Carers or care homes will eat through that in no time. 100,000 is nothing to get good care for a few years.

Exactly! I think it’s quite a lot in the bank too!