Not spending income - adds to inability to claim benefits?

Dunroamin

Bogof_Babe wrote: »

Blimey :eek:. Mind you I haven't a clue what SERPS and S2P are . (No need to explain, it'll only drag the thread further off topic - Google is my friend ).

I believe it can go up to as much as £220 per week which explains why the proposed flat rate pension of £140 (£150?) hasn't been greeted with unalloyed joy.

[Deleted User]

sue4teddy wrote: »

Our thoughts are that he has never had any help from the state and lives like a pauper. Hasn't paid out for new furniture or a car, holidays or clothes (takes hand outs from family) in more than 40 years.

Doesnt seem fair in a way that the state could take his money when others live it up and spend what they have and take all they can from the state.

i did have something to add but having read your last sentence i wont bother myself :mad:

helentay_2

Ravenshade wrote: »

...if you're giving away lump sums of cash yes, it would be deprivation of capital. However... spending £200 a month more than usual is not considered deprivation of capital. They have to prove the matter and that's quite hard. Immoral it may be but illegal it is not. The DOC rules are for those with a significant amount of savings. The DWP expect you to spend everything you get in...so if that's what you're doing, they don't really care how.

What a very interesting thread.

So I am right in thinking that for a pensioner (and I know one that is 88) who hasn't spent a penny of his State Retirement Pension for the past 23 years (approx £102,000 saved) will be penalised if he tries to give it away when the time comes for him to go into a home?

But if that same person had made gifts of his SRP every month to the grandchildren for the past 23 years it would not be seen as deprivation by the council?

Umm confused - it's his income by right due to the financial contributions he paid into the scheme yet he would be penalised if he saved it when going into care?
But if he say gave it away each month that would be acceptable and I presume if he spent it on alcohol, betting and hookers that also would be acceptable and not be treated as deprivation?

So the moral of the story is, never save it, spend every penny you get, and if you can't find a way of spending it normally, you might as well spend your last years on earth high as a kite on Cocaine whilst enjoying the carnal pleasures of a local hooker!!!

What a stupid system.

Fire_Fox

helentay wrote: »

What a very interesting thread.

So I am right in thinking that for a pensioner (and I know one that is 88) who hasn't spent a penny of his State Retirement Pension for the past 23 years (approx £102,000 saved) will be penalised if he tries to give it away when the time comes for him to go into a home?

But if that same person had made gifts of his SRP every month to the grandchildren for the past 23 years it would not be seen as deprivation by the council?

Umm confused - it's his income by right due to the financial contributions he paid into the scheme yet he would be penalised if he saved it when going into care?
But if he say gave it away each month that would be acceptable and I presume if he spent it on alcohol, betting and hookers that also would be acceptable and not be treated as deprivation?

So the moral of the story is, never save it, spend every penny you get, and if you can't find a way of spending it normally, you might as well spend your last years on earth high as a kite on Cocaine whilst enjoying the carnal pleasures of a local hooker!!!

What a stupid system.

Any regular gifts are income so the recipient may need to declare them to the taxman/ DWP/ council as applicable. So unless the recipient is going to commit benefit fraud or tax evasion the gifts potentially are trackable. You can give one off tax free gifts to relatives within your lifetime, no need to wait until you are 88. My parents paid my sibling's deposit on their first flat for example, I suspect there will be lump sums to save for higher education once there are grandchildren.
http://www.hmrc.gov.uk/inheritancetax/pass-money-property/exempt-gifts.htm
http://www.thisismoney.co.uk/money/experts/article-1685934/Should-I-pay-tax-on-regular-cash-gifts.html

Other than that we'd much rather our parents had a choice of which care facility to move to, or to pay for care in their home rather than be reliant on what the state agrees (slowly and reluctantly) to fund. I don't envisage myself at their funerals thinking about what I will or won't inherit, I'd rather have the bitter-sweet thought that their entire retirement was great. If that means spending every penny they (not me, not my sibling, we are not 'entitled') worked incredibly hard for so be it. Don't you want that for the pensioners of your acquaintance?

The DWP expect the amount you claim to have used to live on was reasonable, if you suddenly start increasing your monthly spending or blow a lump sum they can flag it up and ask you to justify the outgoings. So a new car might not be reasonable but a new roof to replace a very leaky one might be. I can assure you a cocaine habit is incredibly expensive, most people's savings wouldn't last long.
http://www.ageuk.org.uk/Documents/EN-GB/Factsheets/FS40_deprivation_of_assets_in_the_means_test_for_care_home_provision_fcs.pdf?dtrk=true

What's stupid about expecting someone to spend their own assets on their own living expenses? What if they inherited those assets or won the lottery? Why should a taxpayer grafting for minimum wage fund a millionaire's care so they can leave their millions to their silver spoon children? Eventually that is what will happen, grandparents and parents and childrens estates all rolling over to good for nothing great grandchildren.

skintandscared_2

helentay wrote: »

What a very interesting thread.

So I am right in thinking that for a pensioner (and I know one that is 88) who hasn't spent a penny of his State Retirement Pension for the past 23 years (approx £102,000 saved) will be penalised if he tries to give it away when the time comes for him to go into a home?

But if that same person had made gifts of his SRP every month to the grandchildren for the past 23 years it would not be seen as deprivation by the council?

Umm confused - it's his income by right due to the financial contributions he paid into the scheme yet he would be penalised if he saved it when going into care?
But if he say gave it away each month that would be acceptable and I presume if he spent it on alcohol, betting and hookers that also would be acceptable and not be treated as deprivation?

So the moral of the story is, never save it, spend every penny you get, and if you can't find a way of spending it normally, you might as well spend your last years on earth high as a kite on Cocaine whilst enjoying the carnal pleasures of a local hooker!!!

What a stupid system.

What "penalisation" is going on??? He uses his own money to pay for his own care - what is wrong with that??! He can have better care than the state would provide and potentially be able to live out his days in his own home with carers coming to him. Why is it so wrong for people to spend their own money on themselves? A stupid system would be where these rich pensioners could let the taxpayer fund all their care so they can hand on a nice big inheritance.

ERICS_MUM

Our parents brought my siblings and me up in the 50's and 60's to believe that the "social welfare" system was a safety net for people in (often temporary) dire straits through no fault of their own, and was set at a level to support basic needs of life especially housing & food.

I don't know how this is furthering the thread (!!) so I'll sign off now.

xx

Lizzieanne

My father-in-law was widowed at a fairly young age and shortly after, signed over his small flat to my husband, his only child, and chose to go into rented accommodation. This meant that whilst *technically* he had nothing apart from his savings (about £5000), morally, in our eyes, the value of the flat was still his (it was about £40,000). In his later life, he became quite eccentric and eventually developed alzheimers.
We were able to use this pot of money (after taking out a chunk to pay the CGT bill when we sold it) to make his life easier - when he could no longer drive, we set up an account with a local taxi company to take him to and from his ballroom dancing. If anything desperately needed replacing in his flat, we did it - sometimes without him cottoning on to what had happened. When he needed a brain scan in relation to his alzheimers diagnosis, the waiting list was huge but we paid for a private scan (about £600) and he was put on Aricept long before he would have been.

When the care we could provide was not enough, and he needed carers at home, we (he) paid for it. When the time came for him to go into a nursing home, he went into a private home at a cost of £650 per week. He had no idea that he was in fact paying for any of this himself and we certainly weren't going to tell him. My husband had arranged power of attourney many years before, which made everything so much easier in the final years.

At the end, in his lucid moments, he spoke of being proud of the 'huge inheritance' that he was leaving my husband with (he was always money obsessed!) but in reality, after all his final bills were paid, my husband had about £1500.

But at no time did it occur to us to claim anything, at no time did we hesitate in spending HIS money on HIS care. Having access to this money made our lives so much easier, as I can easily see how some elderly people would see this sort of expenditure as a waste.
He would NOT have chosen to pay for this, and we were in the fortunate position that we did not have to tell him that he was, in fact, paying for it.

I think perhaps you should urge him to start making his life more comfortable by spending some of his money on things for his home or carers.

My father-in-law clearly had ideas that the state would step in as and when he needed help (or else why sign over the flat?) but the reality is that when your parents are elderly and need help, I think the majority of us ust want them to get it and if the money is there, would want them to have the best they can afford.

helentay_2

Fire_Fox wrote: »

Any regular gifts are income so the recipient may need to declare them to the taxman/ DWP/ council as applicable. So unless the recipient is going to commit benefit fraud or tax evasion the gifts potentially are trackable. You can give one off tax free gifts to relatives within your lifetime, no need to wait until you are 88. My parents paid my sibling's deposit on their first flat for example, I suspect there will be lump sums to save for higher education once there are grandchildren.
http://www.hmrc.gov.uk/inheritancetax/pass-money-property/exempt-gifts.htm
http://www.thisismoney.co.uk/money/experts/article-1685934/Should-I-pay-tax-on-regular-cash-gifts.html

Other than that we'd much rather our parents had a choice of which care facility to move to, or to pay for care in their home rather than be reliant on what the state agrees (slowly and reluctantly) to fund. I don't envisage myself at their funerals thinking about what I will or won't inherit, I'd rather have the bitter-sweet thought that their entire retirement was great. If that means spending every penny they (not me, not my sibling, we are not 'entitled') worked incredibly hard for so be it. Don't you want that for the pensioners of your acquaintance?

The DWP expect the amount you claim to have used to live on was reasonable, if you suddenly start increasing your monthly spending or blow a lump sum they can flag it up and ask you to justify the outgoings. So a new car might not be reasonable but a new roof to replace a very leaky one might be. I can assure you a cocaine habit is incredibly expensive, most people's savings wouldn't last long.
http://www.ageuk.org.uk/Documents/EN-GB/Factsheets/FS40_deprivation_of_assets_in_the_means_test_for_care_home_provision_fcs.pdf?dtrk=true

What's stupid about expecting someone to spend their own assets on their own living expenses? What if they inherited those assets or won the lottery? Why should a taxpayer grafting for minimum wage fund a millionaire's care so they can leave their millions to their silver spoon children? Eventually that is what will happen, grandparents and parents and childrens estates all rolling over to good for nothing great grandchildren.

Yes I fully understand all of that. But I was actually thinking about the gentleman I know that has managed to save out of his benefits/state retirement pension over the past 23 years or so something in excess of £100,000.00.

He lives a very frugal life, hence his inability to spend any of his state pension.

I'm not thinking about inheritances - he doesn't actually have anyone to give it to.

I just find it difficult trying to understand that because he lives in that way his savings (which are entirely the state pension) will be taken off him to pay for a few years of care in a home.
Knowing him, he would feel completely out of his depth if the care home was anything better than what he has been used to in his lifetime.

Still I can see the other side, he should have either spent the money on himself over the past 23 years, burnt it, or have given it away to charities.

It seems that by his actions he will save the taxpayers the cost of the care home, in a way they will be recovering his pension as it was plainly not needed by him.

Becles

sue4teddy wrote: »

Our thoughts are that he has never had any help from the state and lives like a pauper. Hasn't paid out for new furniture or a car, holidays or clothes (takes hand outs from family) in more than 40 years.

Doesnt seem fair in a way that the state could take his money when others live it up and spend what they have and take all they can from the state.

My Gran was the same.

But when the time came when she needed to go in sheltered accommodation, the cash she had gave her a choice. She was able to look around and picked a lovely place with a room looking out over a park and she was very happy there.

If the state is paying, you don't have the luxury of that choice and some homes are awful. Gran was in a one for a week on respite care when my parents (main carers) went on holiday and she hated it so much, she "escaped" and walked three miles back to her flat in her slippers :eek: I wouldn't have liked it if she had been put in that home permanently as she was really miserable there.

downshifter98

If people really think that a big chunk of cash will mean better care in old age they really are being very naive; the real problem is that all of the care providers struggle with low paid staff, low staff motivation, a huge and growing demand and powerful bulk buying councils; I have had some experience of home care for my parents and 4 visits per day equals £500 per week which is paid for by the council if funds are below £23,000 (per person) and by the individual if above; if you are unhappy with the council (bought in) service you can shop around (even if the council are paying) but for all of the reasons above the different providers are all in the same boat and will simply not offer a better service at a better rate than what they 'charge' the council - an individual just doesn't have the 'buying power'. In addition a frugal person with £100,000 in the bank will (in my parents example) be down to the council care in just 3 years. I suspect that care in a care home will be a very similar tale (albeit with the option of family 'top ups' but that's another subject). So, to summarise, enjoy yourself now, live life to the full and if that leaves you a bit skint at 80 don't worry too much about it because care and old age is just the price you pay for living in a modern world that can keep you alive longer - its a blessing but with a possible sting in the tail that money won't do very much to soften.