Taking care of parent's retirement

choc_mouse

I'm in my mid 20's and am fortunate enough to have a well paid job and a growing pension pot from my employer. My question however is about my parent's retirement. They're both in their mid 50's and soon coming to retirement age. They have few savings as they came from a poor/uneducated family and spent most their life on manual labour work and bringing up 3 children. It appears they will be relying on their children (e.g. me) to get them through the final stages of life.

I believe they would be entitled to the basic state pension but that's not much in reality. Could I put my own money into a private pension for them (any tax issues here)? What's the best way to invest ~£200/month for my parents? Is that a small amount considering I'm saving a lot more for myself?

Any advice would be welcome.

CLAPTON

first step is for them to get a (state) pension forecast so they can see how much they will receive

it may not be cost effective to give them a small private pension as the current system of pension credits may mean they will be better off relying on the state thtan having a small additionla pension.
... get the forecasts and see where they are.

McKneff

I dont think your parents in their own right would be too badly off.

Full state pension is about £98 a week each. 2nd state pension is added to that, pension credits, council tax help, all sorts of things will be there for them
Nice of yu to think of them but why not help them first by getting them to contact th DWP for a State Pension forecast.
I think you will probably find that your parents certainly wont rely on you or your siblings to fund their retirement.
If they are in their mid fifties, it will be ten or more years yet, you will probably have a family of your own by then and have your own committments.

I gotta say something though, i found yur description of your parents as poor/uneducated deeply offensive. Poor they may be but uneducated:eek:
They were educated enough to bring up you and your siblings to adulthood and by the sounds of it intelligent and caring - please dont say it again, it was insulting to say the least.

bryanb

McKneff wrote: »

I gotta say something though, i found yur description of your parents as poor/uneducated deeply offensive. Poor they may be but uneducated:eek:
.

OP did not describe parents as poor/uneducated - said they came from a poor/uneducated family.

MyRubyRed

Agree with McKneff. Statement by OP was a bit harsh. Parents are only in mid 50's and if they have managed to bring up three kids I am sure they would be horrified to think that they are reliant on offspring to support them. That said I applaud the gesture of the OP in wishing to contribute to their happy retirement.

McKneff

bryanb wrote: »

OP did not describe parents as poor/uneducated - said they came from a poor/uneducated family.

Still talking about family and means the same to me

ohmsoft

I very rarely post on here anymore as every single post seems to result in some argument about morals rather than helping with the original question.

But I must say i found the OPs intentions very heartwarming (ie wanting to help their parents in retirement). I'm sat with my parents now, and we've just had a discussion in which they confirmed they'd openly describe themselves as uneducated - because they've not had formal education. I really don't see the offense and I wish long term posters would stop throwing critisms at newer posters so often.

McKneff

Yes, they would openly describe themselves as uneducated but you yourself wouldnt go on a public forum and describe you parents thus, would you.

We all felt that the OPs intentions were heartwarming and said so in our posts.

dunstonh

OP, you are jumping in with a potential solution without knowing if a problem exists. You need to find out what they have got already in regards to pensions, savings, investments and state entitlement. Only then can you look at potential solutions. It is possible that going in with a pension contribution at this time could do more damage than good.

sleepless_saver

chocmouse, I'm sure your parents will appreciate that you're thinking of them and are prepared to help them financially. It is a very generous thought. But you need to make provision for yourself too, and I'm sure they wouldn't expect you and your family to go short in retirement in order to provide for them.

Your contribution, if you did make it, could well stop them getting benefits which they might have got otherwise - e.g. pension credit, council tax benefit, and housing benefit (if renting).

I agree with other posters that they should get a state pension forecast which will help with planning (including deciding when to stop work).

ohmsoft

No I may not use the exact wording - but I suspect that the wording is trying to explain the need for assistance rather than the OP trying to insult or belittle their own parents which seems unlikely - therefore I cant see any offense being intended.

I'm sorry really for posting the above as you've all offered helpful advice to the OP but literally just read about 10 threads in a row all of which resulted in judgement calls about morals (on reflection - this one isn't actually that bad).