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chucknorris

DaddyBear wrote: »

When you can't fend for yourself and can no longer afford to pay someone else to do it.

Now that is approaching a sensible (if not PC then certainly MSE) answer. I don't necessarily agree with it and furthermore I don't think I would end up in that position. But it's a pity that the fool that suggested it in the first place didn't have the sense to come back with that.

marathonic

I posted this on another board but it's also relevant here.

Although the idea is going to cost the younger generation significantly through increased income tax, I can see some reasoning behind it.

If the state provided such a cap and current figures suggest that 5% of people end up in a retirement home, retirement care will cost a total of £75,000 for every 20 people.

Let’s face it, the majority of people will not worry about nursing care costs until they retire, or close to it, at which point, paying into a private pension may no longer be a sensible option.

Saving £75,000 isn’t an option if you leave nursing home costs until within 10 years of retirement but the scheme only costs an average of £3,750 given the fact that only 1 in 20 end up in a nursing home. This is assuming that every person entering a retirement home survives long enough to surpass the £75,000 cap which will not be the case – so let’s reduce the average cost to £3,000.

Given the removal of uncertainty around nursing home costs, it would be very easy for an insurance company to give you an option, on retirement, of forgoing some of your tax-free lump sum in return for the payment of your retirement home costs. Given the expected return on investment between retirement age and the age you’d be expected to enter a nursing home, the cost to you should be minimal.

Looking at the figures, if the insurance company were to assume that you are retiring at 67 and will enter the nursing home at 87, and assuming a return on investment of 2% after inflation and their charges, they’d only need you to give up £2,000 of your lump sum in return for covering your retirement home costs, should you need them.

marathonic

I personally think that means testing, although it protects the most vulnerable, adds an element of "I'm not going to save for retirement if all the assets I worked hard for are going to be taken by a nursing home".

If tax was raised by 1.5% and people knew they would have an option of forgoing £2,000 of their pension lump-sum as opposed to selling their house to pay for care, they are more likely to work harder to cover it themselves as opposed to relying on the government.

As stated before, people complain about the rich benefiting more but, at the end of the day, they are likely to be the ones that have paid most of the costs - and I say this as a lower rate tax payer.

marathonic

I suppose the problem here is that, if I'm 75 living in a big house but my pension fund is coming close to depletion, although you'd normally not go into a retirement home, you may consider it purely from a financial point of view.

Some nursing homes today are extremely high-standard but I'd wonder how many people would actually do this considering the amount of time they could end up being forced to stay there through necissity in the future.

N1AK

PasturesNew wrote: »

Maybe I like to dream I'll have wealth I wish to shelter by that time

On the rather naive assumption that spending even more money now on letting the current elderly keep their money and taxing more to pay for it is somehow going to mean the rules will be as favourable when you get there?

N1AK

dori2o wrote: »

Some woman on the phone today was saying she didn't save all her life so that she could pay for care in her old age whilst other frittered their money away and got the care free.

I'm not sure it's so much an entitlement complex as a reasonably fair dislike for a system that all to often penalises the responsible.

Someone who saves the money until retirement receives less assistance from the government than someone who earnt as much but chose to spend it all (or give it away to family) before retirement. I might also feel aggrieved in that situation, and not because I necessarily thought I should get more but instead because they should not get more than me.

The problem is that short of letting the !!!!less freeze to death or spending ungodly amounts of money giving everyone including the very wealthy considerable benefits we can't fix the problem because we messed it up when we started it decades ago.

Many, in fact probably most, people are crap at planning for the future. Left to our own devices a large swathe of the population would live very badly (if at all) once they stopped being able to work. Personally I'm in favour of better education, regular (everyone 5-10 year) financial planning updates and allowing comparative poverty for those who had the means to look after themselves, were warned repeatedly and did nothing to avoid it.

smartn

LydiaJ wrote: »

I don't think you can run a care home (as opposed to sheltered housing) with two NMW workers on duty round the clock, and a manager who's only there during the day. Most homes providing 24 hr nursing care have at least one fully qualified nurse on duty all the time to be responsible for medication and emergencies. They also have cooks and cleaners, and maybe an accounts/admin person in addition to the manager (or several if it's a big home). They have overheads for equipment (hoist to get patients in and out of bed etc, all of which have to be maintained) and consumables (all those gloves and disposable aprons add up, not to mention the incontinence pads and colostomy bags etc).

This is not just about merely keeping an eye on some basically functional old people who are a bit shaky on their feet and need help doing up their buttons and shoelaces. Care homes look after people with dementia, or Parkinson's, or other nasties like that, or maybe two or three conditions all at once. These people need nursing care, pretty much the same intensity of care that you get in hospital, but if they haven't got an acute condition then the NHS isn't interested beyond paying for their physio and supplying them with wheelchairs. That kind of care costs about £1000pw, and with dementia you can need it for several years between becoming incapable of looking after yourself and dying. Most people manage to die without needing that kind of care for very long, but nobody has any idea who will need it until they get to that point.

So far, the women in my family have all needed 24hr nursing care for a few years at the ends of their lives. Most have been widowed and have had to go into care homes. My mum has so far been the only one lucky enough to have a husband still alive and healthy and able to provide 24hr care at home. The level of care he provided (with help from visiting carers several times a day and respite carers for a few hours a week) was not something that could be done by any family member with any kind of job, partner, children, life etc.

Nice to see a post from someone who clearly understands the nature of the problem. It is incredibly expensive to provide the sort of care around the clock needed by many of these people. Plenty of nursing homes have gone under due to these costs.

chem1st

grizzly1911 wrote: »

How many workers were there back then relative to non workers I wonder? What was the average age of death?

There were more working households relative to non working households, I'm not 100% on the relative amounts of workers because women seldom worked.

And what with the means tests, unemployed parents would kick out employed children due to their income affecting their benefits (much like they do now).

People died earlier, the pension age was higher, national insurance was lower, and pensions were affordable.

grizzly1911

chem1st wrote: »

There were more working households relative to non working households, I'm not 100% on the relative amounts of workers because women seldom worked.

And what with the means tests, unemployed parents would kick out employed children due to their income affecting their benefits (much like they do now).

People died earlier, the pension age was higher, national insurance was lower, and pensions were affordable.

Thanks.

Whilst welfare is an issue and needs to be contained and not wasted it isn't the problem IMO.

Perhaps it is just expectations that have been driven too high, private consumption and welfare and the number of productive households has reduced?

dori2o

N1AK wrote: »

I'm not sure it's so much an entitlement complex as a reasonably fair dislike for a system that all to often penalises the responsible.

Someone who saves the money until retirement receives less assistance from the government than someone who earnt as much but chose to spend it all (or give it away to family) before retirement. I might also feel aggrieved in that situation, and not because I necessarily thought I should get more but instead because they should not get more than me.

The problem is that short of letting the !!!!less freeze to death or spending ungodly amounts of money giving everyone including the very wealthy considerable benefits we can't fix the problem because we messed it up when we started it decades ago.

Many, in fact probably most, people are crap at planning for the future. Left to our own devices a large swathe of the population would live very badly (if at all) once they stopped being able to work. Personally I'm in favour of better education, regular (everyone 5-10 year) financial planning updates and allowing comparative poverty for those who had the means to look after themselves, were warned repeatedly and did nothing to avoid it.

I don't think those who save are all that hard done by to be perfectly honest. They are however the first to moan when it doesn't suit them, whether that be in the case of benefits, care homes or interest rates.

In todays economic climate, just being able to save is a huge problem for many.

Wages are stagnant, unemployment is the highest for a number of years, yet living costs, even just the basics, are rising at extraordinary rates.

If you have the ability to save then you are in a fantastic position. You can offset the increases in the cost of living far better. A rise in utilities costs don't mean the difference between being warm or freezing, having a hot bath or a cold shower.

You also have to look on the fact that come old age, should there be a need for round the clock care, you have far better options than those who don't/cannot save.

Those who cannot/don't save will be put into a home at the cost of the state, but just how good will that home be? How modern, how comfortable, how much 1 to 1 care, how healthy are the meals, what activities are there, how much privacy?

It will be the bottom of the scale accomodation, which is more than suitable.

However, those who can save will be able to have a much better care home, or even an apartment in a complex, maybe even they might be able to stay at home with live in care, or a significant amount of care provided throughout the day.

It amazes me how many elderly people who have the ability to save, refuse to spend the money they have, still insisting it is for that rainy day, despite the fact the rainy day has come already.

You cannot take it with you so why defend it like it's the most precious thing on earth.