I am financially comfortable. Inflation is biting me hard. What next?

zygurat789

Also allowable out of capital, gifts of up to £5000 for a child's marriage or £2500 for a grandchild's marriage and gifts up to £250pa to any number of persons. And anything which happened more than seven years before you die.

seven-day-weekend

Can't you give your kids as much as you like?? (puzzled).

lilac_lady

seven-day-weekend wrote: »

Can't you give your kids as much as you like?? (puzzled).

Good point. I thought that as long as your assets didn't go above the inheritance tax line (no chance of that for me!) that you could gift any amount to your children. Am I wrong?

seven-day-weekend

lilac_lady wrote: »

Good point. I thought that as long as your assets didn't go above the inheritance tax line (no chance of that for me!) that you could gift any amount to your children. Am I wrong?

Nor me! .

missile

lilac_lady wrote: »

Good point. I thought that as long as your assets didn't go above the inheritance tax line (no chance of that for me!) that you could gift any amount to your children. Am I wrong?

Not for IHT, but I believe it can be an issue if you give away assets before going into a care home.

seven-day-weekend

missile wrote: »

Not for IHT, but I believe it can be an issue if you give away assets before going into a care home.

If you give them away for the purpose of avoiding care home fees, it can be, but two fit and healthy early-60s can surely give their children what they wish?

maryb

The official rise in inflation was even worse than I thought. I was trying to work out the rule of 72. I know that means that if inflation is 7.2% prices double in 10 years and if inflation is 10% they double in 7.2 years but I can't work out how to interpolate where inflation is not a round number. If inflation is 5% they would double in 14.4 years so I suppose 14 years is near enough as the RPI rise was 5.2%.

We will only be in our mid 70s in 14 years time and the thought of having to live on half what we expected in today's terms is terrifying. I know they say inflation will come down sharply. But even a few years of inflation can have a long tail in terms of damage to your income. And with declining oil production and higher carbon emission reduction targets, energy is not going to get cheaper and the basics are in any case a much larger proportion of a pensioner's expenditure.

In fact I don't know how they manipulate the 'shopping basket' to arrive at 5.2%. They must assume that we all pick up loads of electronic goods every time we go to Tesco!!

[Deleted User]

That would be my understanding too ie giving gifts but not reducing to below care home funding later in life. Personally, I want to be able to choose platinum standard care for either dh or I (or both) if it were ever needed, so will always make sure that enough is safely put by and that includes the value of our home. I also want enough put by for any ops that may become necessary eg cataracts and knees etc. Experience with dh and times gone by, when he had private healthcare via work, he had 2 hip resurfacing ops and has gone from strength to strength since. He is an athlete cyclist and cycles 80 miles at a time with his club these days. Nhs care and his hip problems would have been ongoing and psychologically brutal

So giving money to children, yes all well and good but it will never been at a cost to our own well being and that includes retaining choices

In the meantime, I have a cash bond maturing tomorrow so have to go on yet another hunt for the best interest rate. It makes my blood boil, the way that savers are so penalised

lilac_lady

I'm not thinking about avoiding care home fees and if I need treatment in the meantime and there's a long waiting list, I shall pay to see someone privately for a diagnosis, although I don't know if I could pay for the full tratment if necessary.

I'm trying to live more "in the moment" as this is our time now and part of feeling like that will be spending some money.

missile

lilac_lady wrote: »

I'm not thinking about avoiding care home fees and if I need treatment in the meantime and there's a long waiting list, I shall pay to see someone privately for a diagnosis, although I don't know if I could pay for the full tratment if necessary.

I'm trying to live more "in the moment" as this is our time now and part of feeling like that will be spending some money.

I was not suggesting you were and don't know your circumstances. Just giving a heads up for those who may not have considered that aspect.