Parents have no savings!

laydeeqt

Hello just want some advice really. My parents are just over 60 and 1 works full time and another part time. They have no mortage and are renting a flat for £800 a month. They have not saved into a pension and so once retired they will only recieve the state pension which will barely cover the rent. This is causing me, their daughter of 26, much worry as i am not in a positon myself to assist financially. if was then of course i would help. I want to know what the government does in this instance, and how much help they would provide my parents if they were unable to pay their £800 rent on their pension? If they had to go into care would this be something i have to fund? I am just so worried about what the future holds with my parents that i don't know what to do.I must mention my father is mentally ill and recieves disability benefit to some extent, but he does still work part time. I cannot find the answers to my questions anywhere on the internet?
Thanks

dunstonh

I want to know what the government does in this instance

There are pension credits available to those with low income and low savings to bring them up to a breadline level.

There is a calculator here to check qualification: https://www.gov.uk/pension-credit/overview

If they had to go into care would this be something i have to fund?

Based on what you have said, they would likely qualify for local authority care.

atush

How very unfortunate for them and for you. I would imagine they would get some sort of housing benefit but don't know as I don't know anyone in my family who never saved and bought a house so this hasn't arisen.

I would contact the CAB and age concern and ask some of these questions, or ask on the benefits board. Folks there might know the answer, it isn't really something covered here.

I do know that if they have no money you oud not be required to fund them, but having said that, the homes that are council only funding with no private contribution are very basic and not very nice.

Having seen this situation with your parents, I do hope you take steps now to avoid the same happening to you.

One thing you can do, is help them check that they are paying the lowest possible for all their insurance and utilities etc, and to encourage them to at least save what they can now. they may end up not really retiring if they can't afford to. And your visits to the CAB and Age concern may flag up some benefits they haven't been claiming that they can going forwards.

Good luck.

meg72

Your parents would receive pension credit , help with the rent an council tax, if they have to go into care, with no savings and no property they would get state funding.

Please stop worrying there is a lot of help available for pensioners in this position.

xylophone

http://www.ageuk.org.uk/money-matters/claiming-benefits/pension-credit/

sleepless_saver

State pension is due to change in 2017 so some of what they will get depends on when exactly they are able to claim state pension. Of course, one or both might decide to continue working - they can do this and still claim their pensions. Do either of them have occupational pensions from current or past jobs?

First off, they should each ask for a pension estimate https://www.gov.uk/state-pension-statement . You can use a benefit checker http://www.turn2us.org.uk/benefits_search.aspx to find out about their likely entitlements under current rules. Remember to include the disability benefit.

I agree with atush that you won't be expected to fund their care if they turn out to need it - but I'd disagree that all council homes are bad. Some are very good. Also, very many people who cannot pay for their own care are not in council homes - they are in homes which also accommodate self funders, the difference being that they are paid for by the council.

jamesd

They would each receive both some Basic State Pension and some Additional State Pension, which is based on a combination of amount earned and years worked and is on top of the Basic State Pension. Each of them should get a State Pension Statement to find out their current entitlement. It's quite likely that each would be on around £150-£160 a week if they both worked for most years of their working lives even on low incomes. Someone on average or higher incomes for many years could get more.

If their incomes are low enough they will get Council Tax Benefit and Housing Benefit. When of state pension age they could also qualify for Pension Credit to top up their income to a minimal level for basic living.

You will not be expected by the state to assist them in any way with the cost of living. You should not assist them with regular payments that could be counted as part fo their income if they are on means tested benefits but periodic payments would be fine.

If their flat has just one bedroom the proposed changes to benefits that could reduce benefit levels for those who have more bedrooms than they need wouldn't affect them. If they have more than one they might be affected and might need to move to make things more affordable if they couldn't afford the extra cost.

sleepless_saver

jamesd wrote: »

If their flat has just one bedroom the proposed changes to benefits that could reduce benefit levels for those who have more bedrooms than they need wouldn't affect them. If they have more than one they might be affected and might need to move to make things more affordable if they couldn't afford the extra cost.

This change doesn't apply to pensioners, or to people renting privately (whose housing benefit is already limited to the number of bedrooms considered necessary).

laydeeqt

thanks everyone for your help; i am still confused though. if my parents for instance lost their job tomorrow, they couldnt afford to rent private- and from what i hear, although they may be quite high on the council list they have only just put themselves on this so i'd imagine they'd be quite a wait for a council home. They would be homeless and i would like to know what the state has in place for circumstances like this, if any?

jamesd

Local Housing Allowance (replacement for Housing Benefit) is available for private tenants who have little income. That pays up to the local area limit. The local area limit is set for each big town or region. They would not get more than that limit even if their rent is above it. It would be up to them to choose to pay the difference or to move to an affordable place. You'd need to check the limits for their particular area to find out how much they could get. The limits are deliberately set to a level that is below the average for the area because it's not intended to fund the more costly places.

A couple would be entitled to the appropriate payment level for a one bedroom place.

They would also be entitled to the usual income and other benefits for the jobless who are looking for work.

For the state pensions they should get a state pension statement. That will tell them what they are entitled to under current rules. It'll probably be higher than the proposed new £144 level for each of them if they both have long work histories. Don't be misled by just looking at the basic state pension amount, those who work normally also get additional state pension that can easily take even a long term minimum wage earner to £170-190 a week in state pension. If their entitlement to this is greater than the £144 they would get the higher amount if their state pension ages are after the proposed new system comes in.

MsSupertech

You're obviously a credit to your parents and it's a shame your family is in this position. Your income should have no impact on your parents pension or benefit entitlement so please don't worry on that score. If you feel able to help them financially in the future please seek proper advice before deciding the best way to manage this. I suggest you all get together with CAB and/or someone from one of the Age/Mental health charities to make sure they receive all the help they may be entitled to. Hopefully this will help to reassure you