Parents hoarding money

[Antisocialg1t]

Speaking to my Dad today and he boasted he saves £2,000 / month and has well in excess of £250,000 sitting in the bank. He was lamenting not having enough places to put his money without paying tax. He also stated that in retirement he's never had it so good compared to his working life.

I can't help but feel resentment. I think this stems from the almost daily grind of raising two children (15 and 13), always wanting the best for them, and sacrificing constantly. I'm hugely motivated by the fact I strongly believe that adult life is going to be harder for them than it was for me and hugely more difficult than it was for my parent's generation. I just can't reconcile feeling how I do about my children, and knowing that my dad thinks very differently about me and my family. It has brought to mind how little he's ever done for my children / his grandchildren, despite being retired for their entire lives. It's also brought into sharp focus how much of his time he's used to save and hoard money, rather than give more of himself.

But I feel huge guilt because this has come up because of a conversation about money.

Anyone else in a similar position?

What a lovely friend you have.

She must be in her 50s? sponging from her elderly parents and expecting her Mum to pay for caring for her for a few weeks when unwell? and no pay, no care?

At this stage my friend is making plans to get back into part time employment for financial reasons. - so she's able to work part time but prefers to sponge tax payers, not only her parents? and you seem to support her?

low life

A gift above 3k is only liable to inheritance tax if the gift giver dies within 7years (hence gifting large amounts earlier is advisable) even then it is tapered. IHT is only due above the threshold amount which differs according to circumstances as amounts can be combined. IHT tax can be offset by gifting the charity - all on the gov website

No it's not. 3k pa can be gifted and won't make it part of estate. Also any amount given on a regular basis out of regular income, without impacting giver's lifestyle, can be given and won't be subject to IHT.
Giving away assets (e.g. cash out of savings, not regular income) as a one off will be subject to IHT proportionally if giver dies within 7 year, but at reduced scale.

ETA: Deprivation of assets and IHT are completely different and unrelated things.

Yep I said above 3k please read post

Yes I understand ‘excess income’ for regular amounts

An asset is not automatically subject to IHT unless it exceeds the threshold of 325k or 650k through spousal transfers and 500k for a property for ‘direct descendants’

I never mentioned deprivation of assets - irrelevant to my post

It’s pure greed.

Look at it like this… if someone came on here to say that their parents had so much food in their house they would never be able to eat it all, pantries overflowing, more food than they know what to do with. Yet the OP doesn’t have enough food to feed her family and the parents won’t help. They just brag about how much excess food they have. What would you all say?

What a despicable post!

I think the average time people stay in care homes is 18 months...

This. It’s personal choice what you do with any money you’ve earned etc.

The overweening sense of entitlement on here from some adults, with regards to their parent’s money, is indeed grim.

No, what’s grim is loving money more than you love your children. How can you watch your DC and DGC suffer through lack of money while you have more money than you will ever need?

Just saying, one of my parents, used to withdraw their pension every week and keep it at home. Over the years this mounted up..and it was kept in a plastic supermarket bag under the bed. Many times I was asked advice on what to do with it or where to keep it. Never took any advice, always said 'I'll think about it' Then they finally decided. Put it back in the bank. The next day said to me 'I'd better get to the bank the get some money out!' Now?? Had to go into a care home and all the money is now gone. You CANT tell an old person what to do with their money as they will not take advice.

How do you know it’s more than you’ll ever need? Two people needing residential care costs more than £150k a year.

We have adult DCs and are giving them money now towards deposits on flats.
they both work hard, they need this help now not in perhaps 20 years time.
Know we are fortunate to be able to do this.

the idea the state will pay for your care if you have given all your money and assets away is naive- yes some people have done this, but as the population ages and it becomes a far bigger burden then action will have to be taken.
The idea councils won't come after relatives for money when they are facing bankruptcy already when very few people have managed this is naive in the extreme.

Yes - so as I said before it depends on the size of the estate, therefore IHT isn’t always payable.

It's so strange if he has a decent relationship with his dependents. As a near retiree, there is nothing that gives me greater pleasure than to give my (adult) DC something extra to 'help'. My DM on the other hand is now a widow sitting on a healthy pot and thinks a donation of £200 is equivalent to £1m. And she still saves £1 off coupons and can't understand why we don't drive miles from a destination for 'free' parking. Parking charges approx £2 🙄

The idea councils won't come after relatives for money when they are facing bankruptcy already when very few people have managed this is naive in the extreme.

The LA’s do this now and have done for years. It’s called investigating a deliberate deprivation of assets. What’s your point?

All those posts are in response to your assertion that if people give away all their money the state will cough up if they need care. It won’t.

Yes, it will. If the giving away of assets is done at the right time. That’s a fact, not an assertion.

Local authorities go back a long way now. Realistically anyone can be expected to know they may need care one day, regardless of their health at the time of giving away money. As local authorities get more cash strapped and the number of old people grows it’s inevitable that the checks and criteria will become more stringent. In any case it’s not “the state” that pays, it’s taxpayers. Do you really want to pay for care for wealthy people who have divested themselves of their money? I don’t, especially since I’ve been fiscally responsible. Why would I subsidise other people’s adult children?

They can only go back 7 years. Banks don't keep records longer than that!

That food will just rot, doing no one any good.

There is every chance the parents’ money will be needed to fund a decent quality of life in care. Council provision can leave muchvto be desired.

Deprivation of assets is a slippery slope. PPs have made some false assumptions I will address below

Usually you can only access your records this far back, at least without paying dearly. Banks keep records longer. How do think they co-operate with HMRC, which occasionally seek records going back 20 years?

There is no specific time limit for deprivation of assets. Furthermore, the recipient(s) of the assets can be pursued by the council for care home charges. Look it up.

That's a common misconception, but untrue. There's no limit on how far back a local authority can go. The only test is whether someone had a need or expectation of care when the assets were disposed of...

Regardless though, framing 'saving' as hoarding is a deliberately provocative way of articulating a problem that affect very few people. Most retired people rely on a combination of pensions and capital in old age to provide an income. If the capital is given away, then income is reduced. For many pensioners that's not that appealing, as it will impact their standard of living / quality of life with no opportunity to replenish the capital. Not to mention the need to provide for possible care needs in even older age. My parents have 'ringfenced' £750k for their possible care needs - but that's only 2 or 3 years residential care for each of them or, a more likely outcome 5 or 10 years of ever increasing home care needs for them.

It's a minority of retired people that could afford to give away capital without impacting their income, and the overlap on a Venn diagram between those pensioners and their children that are in need will be even smaller. That's not to say that those that are impacted don't find the lack of generosity difficult to understand - but it's far from all children of retired people with a bit of capital!!

They can go back as long as they want, that wasn’t my point.

I think it’s other people that need to look up the rules on deliberate deprivation of assets:

https://www.ageuk.org.uk/siteassets/documents/factsheets/fs40_deprivation_of_assets_in_social_care_fcs.pdf