Realistic for SIL to rely on inheriting mother's London house

[Opalfleur2025]

SIL is 25 this year and told me she plans on "winging it' through life like her father. What her father did was that he got 100k out of the divorce settlement (despite not working through most of the marriage but he did buy a house jointly with MIL) and then moved to an Asian country where he has a new wife.

I think she is saying this because she knows that MIL would pass the whole house to her which I am fine with. She lives at home and earns a modest amount every month writing online i.e £1k per month. No plans to move out or increase earnings, and limited potential as she has no gcses

I am interested if this is realistic. I read that care can cost up to 65k per annum so assuming MIL goes into a care home for 3 years, that would only be around £210k? House is a 3 bed victorian terrace in zone 3 london so worth around £600k today so there should be plenty left for SIL? MIL's mum died of dementia and I suppose these things are hereditary.

I am a fan of Gary's economics and his view is that for poorer people who own homes (where they don't have other assets) all of the assets will be absorbed in retirement or end of life costs. MIL doesn't have a pension other than state pension and she is self employed (but her profession is under severe threat from AI and she is in her 60s). I know Gary's parents lived in London (owned a house that is pretty much identical to MIL's house) and so probably so did his grandparents? Yet according to him, there was absolutely no inheritance even if they did own their homes.

I also expect that many older people may sell their houses to pay for ancillary medical costs due to long nhs waiting lists.

DH and i own our home in London and we are making provision for our old age so inheritance not a concern for us.

I was 25 and living with my MIL before, but when I was 25, i had a job, 58k saved up with DH and therefore started viewing flats. When i was 26 and we had saved up a bit more, we bought the flat.

25 is very young and a lot can happen, i think what is constant is her mindset and also MIL is not doing anything to encourage her to do differently. It would be fine if she even moved out at 50, but of course as time goes by, it has become harder and harder to rent or buy privately.

It is much harder compared to when i bought in 2019.

If MIl has a house in London worth 600k than she is wealthier than 70% of the Uk population.

So she is wealthy.

I understand you are not British and are asking about inheritance/older people generally.

So probably about half the British population own their own home. Half rent.

The majority of people of state pension age or above own their own home. They live on a mix of state pension and private pensions. The state pension alone is not enough to live on but people over state pension age are also entitled to pension credit which is a benefit that tops up the state pension to an amount that can be lived on.

Some people as they get older retire elsewhere. Both my grandparents grew up and lived in London. One set retired to the south coast (extremely popular with pensioners as it's warmer and cheaper). The other set moved to be near their children.

This move usually frees up capital - they sell a big family house in an expensive area and buy a two bedroom house in a cheap area. The capital is then sometimes used for house deposits for other younger family members or to go on cruises depending!

So as the parents age they don't live in the same house as their children but they often live close. So for example my grandma lived about 20 mins walk from us once she left London. So we popped in and she popped in and mum did her shopping and dad took her to medical appointments etc,

This isn't always the case - some people retire in a beauty spot or miles away from family. But it is reasonably common.

My dad died of cancer recently. He never went into a care home. He has two children, one in New Zealand and I'm 4 hours drive away. After operations when he needed care he was in hospital and then came home with 4 care visits a day. So no live in carers but visits.

At the end, he was on a hospice waiting list but they didn't have space for him so he went into (normal NHS) hospital on palliative care and that is where he died,

Ahh sounds like you are from Singapore 😃

The housing situaiton is very different here. There is long term, secure rented housing supplied by local authorities but it is very hard to qualify for. Everyone else is on their own and has to buy on the open market or rent privately (which is very insecure).

Work place have to offer an additional pension scheme to the state pension, but you can opt out. Obviously healthcare is free at the point of use, regardless of tax paid.

This is astonishing honestly...

such a lot of money and the luckiest generation...but all spent so quickly.

its something to bear in mind for myself as well!

With family history dementia they could be many years in care home. Round the clock home based care not far off

Why are you fine with her getting everything? Unless you are incredibly wealthy and the funds are a drop in the ocean then your family is equally deserving of any leftover as an inheritance.

Care home costs will certainly go up, and of course your MIL could end up in a home for 10 years for all anyone knows. Your SIL is bonkers to rely on this.

I think I am reasonably sensible, but at 25 I had just come back from traveling/ living abroad for 3 years. I had no house/ pension/ retirement plan. But I did start working towards a professional qualification.

She is still pretty young so you never know she might change her way, or marry someone rich 😂

She's only 24. She knows nothing about how the world works. She just needs to grow up a bit..

Is that always possible for people with dementia?

She isn't necessarily going to get dementia.

Nursing home fees are indeed £60-80k per year , BUT there’s a lot of caveats to that.

the average care home stay is 801 days, with 50% of residents dying within 450 days ( so there’s a long tail of long stayers in a small minority)

also, some people end up with funding for nursing needs, leaving “ only” care elements. My dad is at end of life. He has maximum nursing needs, on a section 117, so has funding for that. He has also spent all but 4 months of last 13 months in various nhs hospitals where he did not pay ( including being sectioned). He’s paying ( or LPOA is) fees of £1200 now, but it’s unlikely to be for more than months or weeks were told.

in 2025 the “ care cap” is supposed to be introduced, it’s been delayed countless times so could be again. At time it was set to £ 86k which was the average total spend. So, that also helps to indicate what total spend typically is. Though inflation will have affected that as set a long time ago now🤦‍♀️

. Ok, womens are considerably less, but average pension is now £18k net, due to interest on savings/investments being higher. That goes a little way to paying as well

so if you work on average stay, average pension, average fees and no cap in existences still, you’re talking around £117k to find from assets - not the £210k you state. And possibly less if there are nursing needs that are funded nearer end of life.

on the other hand my mum, maternal gm, we’re dead by 60 and nothing was spent on care. My gf dropped dead in his garden, after a lovely bit of tidying up, at age of 89! Despite what you hear or experience just 4% of population over 65 are in care homes, and even in over 85year olds that number is still only 15% .

yes, most over 85 need some support and that will need some of their money spent but attendance allowance helps

Some dementia types show SOME hereditary tendencies, but it’s not a clear picture. It is also a possibility that there’s a correlation in families with lifestyle or other inherited condition ( I.e sleep patterns, smoking etc) - but we’re still so far out from any clear epidemiological causes and effects.

aslo, people overlook that money will need to be spent long before care costs come into play. MIL has low income, Victorian house etc which will need any amount of maintenance work. Cars/ white goods/ electricals need to be replaced for a few years at least, holidays and travel paid for, the odd wedding and birth etc. without a large pension that will have to come from savings. When that runs out downsizing.or equity release. That’s why so many people end up doing equity release . In this case the house will have to be sold much quicker if MIL needs care cost covering

but mostly this is speculation. MIL is younger than me. And I’ve no idea what my kids will actually inherit! Life throws curved balls- I could have a big win on premium bonds, live the high life, die of heart attack in my garden and the kids will” have a big IHT bill 🤣🤣🤣🤣. But that ain’t my problem!

At end of day, anyone relying on an inheritance is naive imho!

When my Mum died in late 2022, care costs were £82k/year.
It was for dementia care only & we are Surrey based.
I remember talking to a resident's son before Covid (ie pre-2020) & his mother's costs whilst still in London were over £80k/year back then!

£62k/year for full nursing care in London sounds pretty optimistic.

MIL has no car and free public transport. Doesn't replace anything unless it literally dies on her. Her house is in very bad condition (so perhaps may not sell for £600k given the cost of tradesmen). She only goes abroad to visit her father (and he is very old) and that is on ryanair flights. Her holidays are walking holidays in youth hostels, usually booked midweek and she doesn't even buy food outside.

I think she could live on state pension but even she has doubts. Council tax alone is £200 and bills another £200. She doesn't eat meat.

I get that you are interested, but my response would be "will you dear? oh that's nice" followed by a change of subject. A reasonable, nice but not fabulous, care home round me (south) around 15 years ago was 1k a month plus extras. I have no idea what it would be now....of course if your mil wants to stay in the same area she is in now then the sky would be the limit.

I've got another question OP .... how do you know so much about your MIL's financial situation? Obviously it's easy to work out how much her house is worth but how do you know about her savings/income/pension?

I'm mid 50s and, although I'm quite generous with them, my adult DDs don't know exactly what I have, let alone their partners. I find it quite astonishing that you know so much about her personal affairs.

But she’s 60and theoretically still working.
ever read the poem “I shall wear purple”?
no one including SIL knows what MIL might do age 67 with state pension.
And my point is speculation is a waste of time.
just because that’s how she lives her life now, means nothing .

seems like you know an awful lot about MIL financial affairs! A bit odd to know that much detail.

What is your home country? It’s system is interesting

your MIL is only 61 and your SIL is only 25. It’s daft to think about it now when so much can change. MIL could live to 100. SIL is likely to find a partner she wants to move in with. Heck MIL may also find a partner and kick SIL out and leave property all to her new love interest.

London houses don't really sell on condition.

I mean it makes a difference but it is location and size that determines the price.

A relative of mine sold a house in London in 1988 which did not have central heating, any phones, and had 1920s wiring. The new owners completely gutted it and basically rebuilt it.

Zoopla will give you an idea of what the house will sell for.

She says she has no pension other than state pension.

DH knows her income as they had to fill out the details of her income to get maintenance grant/loan for university and it has stayed the same since then or even fallen in real terms.

As for savings, she raised 4 kids on her income and can't afford to contribute to pension so definitely there is no significant savings.

Lets put it this way, when DH was 11 years old, he couldn't afford bus fare to go to secondary school so had to cycle there. He couldn't go to school trips that cost more than £5 (and he only went once). When you are that poor, you know. You know how little money your parents have.

But you also know the house is paid off(was concerned she might be affected by rising interest rates but happily she is not) and so that is the only thing that she actually has. MIL occasionally talks about renting out rooms once the kids are gone to supplement the income. But in that vague' will never happen' way.

I actually have more knowledge about her finances than my own parents. My parents own multiple commercial properties plus the detached house they live in and they have diversified investments so i have absolutely no idea nor am i very interested to find out. I know they will be 100% fine no matter what happens. My sister and I both own our homes (my sister is in the middle of buying hers) and we will both save for retirement so in a sense its not very important what they have.

‘Most people have parents who own houses’. Some have, but not most, imo

its cos i know about my DH's childhood. When i first met him at university, he often had no money while waiting for student loan so i was buying him lunches (I offered).

She has no money and that house which she has paid off. She told me a bit about her property journey when I was moaning about london house prices as a 25 year old saving for my deposit.She bought a 1 bed flat which she sold at a loss to buy the terraced house she still lives in. And DH told me one reason why he no longer speaks to his father is because he demanded half of the house when they divorced (despite not working for most of their marriage) and DH felt that this put their entire family's finances in peril and their mum kept crying as she thought she was going to lose the house. So she had to remortgage due to that though he didn't get half. This happened when my DH was around 18.

She has been telling me about the impending london house price crash that will mean i can afford a mansion since 2017 :) Apparently thats how she could afford to buy her house in 1996 lol.

Isn’t she meaning marrying someone and getting a settlement if it doesn’t work out to live off them in matrimony ? That’s what most of my “ winging it” friends have meant - and sounds like what her Dad did.

thats a thought but how is she supposed to meet this rich person with assets if she has no qualifications and is self employed.

In the past people on blue collar salaries could buy london houses which then appreciated in value rapidly over the years. Most of my friends who own homes these days (not just in London) are generally well educated and in good stable jobs. For millennial (aged 25-34), its the top 25% who manage to buy. Perhaps the 40 year olds, it would be the top 30-50% but still resolutely the top half.

Op there is a care cap of 86k. In addition only about 20 percent of the population go into care.

you do seem over invested in this young woman and her finances.