DM making request to give away a lot of money

[LPADilemma]

At the moment I just have control of 2 bank accounts because DM was ill and bank transfers were needed. DM is well over 90 and only writes cheques. Yesterday DM says she wants to write cheques to each grandchild for £10,000 each. This would amount to over 60% of available funds. Some of which are not very liquid due to end dates for savings being a little bit down the line. Dm owns her home.

She now has far more care needs to stay in her house. She’s in hospital right now and I doubt that she’s come up with this idea herself. Never mentioned it before. I’ve no doubt it’s come from another member of the family. My instinct is to tell DM it’s a very bad idea but she still has capacity. If she does decide to do this, I might see if I can relinquish LPA because I’m sure it’s wrong. However she’s capable of making decisions but the implications of giving the money away might not be understood. How should I deal with this? My DC would benefit but she would need to sell her home and move (it’s small!) when the remaining money runs out. It will.

Again, you're wrong.
I've been doing this for a long time, and have consulted professionals at various stages when confronted with decisions like OP's.
If her mum didn't have capacity, you'd be right. OP would be able to make decisions in her interest, and so wouldn't be able to give away money that mum needs.
But while her mum has capacity, OP's role is limited to doing the bit that her mum is physically unable to do, which is to operate the account. And of course she can inform and advise her mum.

If you disagree, then take it up with Age UK's legal advice line, which has been incredibly helpful to me on several occasions.

@LPADilemma I know some have already mentioned it, but I can't praise AgeUK's advice line enough. When I first called them I didn't expect a lot, but I was blown away by the knowledge, the time they gave me, and the care.

I called them again a few weeks ago, and had a good half hour of advice, which was great. But better still, a few hours later I got another call from the advisor "I've been thinking about your situation and I've just had another idea...". Honestly, so good, and no cost to me at all.

Yes, this.

She can't just give away all her money, however much she might want to. Maybe suggest that she puts a codicil in her will instead. I'm assuming she does have a will, of course.

Well this is fun, isn't it?

The government website on LPAs is clear:

"As a property and financial affairs attorney, you make (or help the donor make) decisions about things like:

• money, tax and bills
• bank and building society accounts"

The power is about decision making.

It goes on:
"You can start making decisions while the donor still has mental capacity if both:

• the lasting power of attorney (LPA) says you can
• the donor gives you permission

"

You are not the donor's slave or assistant, there is no power for them to compel you to carry out their demands. If they have capacity then there are many ways for them to conduct their banking without you.

I don't need to take it up with Age UK's helpline, and nor does the OP. She can just say 'no'.

Thank you everyone. This was a massive curved ball yesterday. I have a Dsis with no DC who has clear ideas on how DM should gift money. She’s already advised on ceasing birthday presents for my DC (£30) and favouring the other grandchildren above mine with sums of money. This suggestion at least treated them equally but it was suggested it should be £10,000 each. So £50,000. IHT isn’t a worry but with care at home fees increasing, I think she will end up way below that and has DF’s unused portion of the allowance too. If I’ve understood it but DF didn’t make a will. I’m also not sure if they jointly owned their property. However I’m thinking this isn’t a great worry.

These gifts would mean around £30,000 of savings left but not all is easily accessible. Unfortunately she’s not given chunks of money before. Just the birthday and Christmas presents so I know there has been interference. Plus going through her savings statements I suspect. She’s also nearer to 100 than 90. Keeping her at home is a priority but £80k goes a lot further than £30k. It’s difficult to see how you stay at home with insufficient funds to cover the costs of £2000 a month and possibly double that!

I’m obviously worried about deprivation of assets. She has the state pension and attendance allowance but no private pension. She has savings and her home (worth about £300k ish). I don’t think she’s remotely thought through the costs for living at home or elsewhere (she doesn’t want a care home) and I’m livid this gift has even been suggested.

Im maybe thinking of a much smaller amount per grandchild at Christmas. Luckily she doesn’t have a cheque book in hospital. She also wanted to put caveats on how it’s spent.

I am also wondering if the compromise might be changing her will. At the moment it’s left to us three siblings. I am thinking grandchildren should be included. One sibling who makes these suggestions doesn’t have Dc but she’s got more than enough for her needs. It’s so difficult.

I am now assuming she has capacity. So I will just have to set out the position to her.

I’d also say, that one thing that seems common as people get into very old age, is they seem to loose impulse control

impulse control is , apparently they now think, one of last bits of neurological development that takes place all the way into 20s. I often wonder if in turn, it’s perhaps the earliest bits of neurological decline that happens as we get much older, even where the full horrors of dementia are avoided.

She and I prefer certain payments are made by bank transfer which she cannot do. I accept I advise and I’m trying to guide her and when she gets home she has a cheque book …….

I think the existence Power of Attorney is a total red herring here. She has capacity, and a chequebook. As a family member you can give her advice, as can others. She can and will do as she pleases.

It’s long been an issue that DSis, who wasn’t seen for years and years (my Dc don’t think they have seen her more than 7 or 8 times) is the prodigal daughter. Turns up once in a blue moon with ideas and reinforces them with follow up phone calls. It’s very difficult.

I don’t always approve of DMs choices. She’s very bright but doesn’t heat her home and sits around wearing coats. She’s always clothed herself from jumble sales. Food is very very basic. She tells everyone she’s poor. There is no doubt that a certain amount of common sense leaves us as we get older!

I just felt with LPA I had a duty to advise?

However if she gives the money away, I will not continue as her attorney. Assuming I don’t have to!! The consequences can be dealt with by DSis.

You have a duty to advise as her daughter, really. But not necessarily as her LPA (as in it's not a specific responsibility if she has capacity)
I definitely would though. If remaining at home is important to her, then hopefully she'll recognise what you're saying, and re- think.

My mum is as unreasonable and mercurial as it gets, but with the time advantage that we get because she can't do things herself, we've so far been able to talk her round. I hope your mum will listen to you and choose home. Reassure her that her grandchildren will benefit from her will instead.

@saraclara Yes. Thanks for ageuk suggestion. I feel with two of us advising it’s clouding common sense. I’ll talk to mum about the will. Percentages to beneficiaries I think.

I would tell her that lovely though it is that she wants to take care of her GC by doing so she probably will not be able to stay in her own home and will need to sell her house to go k to a home.

I would also say to your siblings: ‘Mum was wondering about giving the DGC £10k each. I have done some research and As her attorney have advised that she does not need to do this to avoid IHT. As the house is left to us, with hers and Dad’s combined allowance and the extra amount for leaving your house to your direct descendants, the estate would need to be over £1m to incur IHT. Meanwhile she has care costs which are likely to increase once she is out of hospital. The gifts she is talking about would deplete her savings by nearly 2/3 and if it runs out she would need to sell the house and pay for residential care. I don’t think Mum wants this, if it can be avoided. Not sure if she has discussed any of this with you, let me know if you have concerns about my advice. “

I think if you want to discharge your obligations in a very literal sense, you should carefully read the document granting you the power of attorney to confirm what you actually agreed to do, which is probably a really good idea in any case.

But all official written material on powers of attorney refers to the attorney as being responsible for making decisions independent of the donor. You don't need an LPA to give advice; every loving family member can do that.

I've given family members signing authority over a bank account in the past; I didn't give them a power of attorney because I didn't give them permission to choose how to spend my money. Although it doesn't make any difference to the bank, the difference was clear between me and this family member - they could transfer money on my instruction and with my consent. Not on their own initiative.

That's why I think the LPA isn't relevant. You aren't deciding to gift any money, she is; and she has capacity to make that decision by herself. Whether you want to use the powers the bank accords you (as part of your LPA) to help her carry out her wishes or not seems to me to be at your discretion.

@VineRipened At least one sibling came up with this idea. What makes me cross is that DM just goes along with it and that these gifts were suggested in the first place given the situation. It’s always down to me to explain and be sensible!

This. Suggests she writes a will and leaves each dgc £10k in her will.

From her perspective, leaving money a will is very different. Part of the pleasure of a gift is the appreciation from the donee, as well as, possibly, having a hand or a say in what gets done with the money, which is something I think they OP already said her DM had voiced. Large gifts would give her immediate relevance and input into the lives of the younger members of her family, in a way that (perhaps) she feels she isn't granted at the moment. In the nicest possible way, it's buying influence. She won't get that satisfaction if the money isn't received until she's dead.

It's a really bad idea. My mum needed care from 90 to 93 when she died. She didn't want to go into a home so was looked after at home by carers. She had savings, so it was all funded by her. It cost well over £20,000 a year to do this for her. She had excellent care rather than quick 15 minute visits and was worth every penny. She stayed at home til the end.

The amount that a person can gift to relatives per year, all the information is on www.gov.uk

The previous poster is correct, that a gift for a wedding is more

https://www.moneyexpert.com/life-insurance/gifting-money-to-children-and-grandchildren/

If your DM truly wishes to stay at home it's perfectly possible. However make her aware that it will take money, money she won't have if she gifts it to her grandchildren.

Live in care at home can start at about £1000 a week for low level needs ie company, food prep, light housework of a small home, basic personal care.

Home care of 12hr shifts waking day & night support (if she needs help more than twice a night) starts about £3500 a week.

Care homes £700-3000 a week unless she has particularly challenging needs.

Reminder her needs can change too, & she could live for years.

At her age & circumstances she would be expected to provide for herself. Deprivation of capital would mean she would still be assessed as having that money. Ask if she wishes to find herself asking for the money back from her grandchildren or find herself having to move into the cheapest, crappy care home in the county?

If she still wishes to make such gifts then you can't stop her, but as you know you don't need to pick up the mess as her LPA.