Savings & Pensions

Jhuds72

If someone has money in savings in preparation for possible care home fees, will that effect their state pension? 

dunstonh

The state pension is not means-tested.   Whether you have £1 or £1 million pounds, you still get the state pension you have qualified for.

Jhuds72

Ok great. My elderly Mum was advised to keep a substantial amount from the sale of her house to cover potential care home costs and I didn’t want that to effect her pension, so that’s great. 

pjread

Arguably a "substantial amount" in cash is as much risk as other asset classes, if this is likely in the next few years then fair enough but if it could be 10+ years away it might be worth chatting to an IFA.

Albermarle

Jhuds72 said:

Ok great. My elderly Mum was advised to keep a substantial amount from the sale of her house to cover potential care home costs and I didn’t want that to effect her pension, so that’s great. 

Is there a specific reason why she is likely to go into a care home ? Despite popular myth , most old people do not end up in care homes .

Jhuds72

I realise that but she was advised that by selling her house and giving the money to her children, she’d need to keep some to cover possible care home costs or the government will want a load of money.

NottinghamKnight

The probability of going into a care home is certainly not huge but numbers are rising and will continue to do so as people live longer but potentially with more health issues. It would be prudent to retain money for that, giving money away could be construed as deprivation of capital, though that would depend on timescales. It would be wiser to retain cash in such circumstances to maintain control over options and homes rather than being limited to council places.

dunstonh

Jhuds72 said:

I realise that but she was advised that by selling her house and giving the money to her children, she’d need to keep some to cover possible care home costs or the government will want a load of money.

That is probably down the fear that the benefits agency would treat that as deprivation of assets (which is likely as it stands out like a sore thumb).

Albermarle

Jhuds72 said:

I realise that but she was advised that by selling her house and giving the money to her children, she’d need to keep some to cover possible care home costs or the government will want a load of money.

AS she has  some financial reserves , then the reality is that once she ( and family ) will see their first council run care home , she will be happy to pay privately for something better anyway . So this issue of the 'government wanting a load of money ' will never apply anyway .

Jhuds72

I just wanted to ensure her pension won’t be effected by having savings, hopefully she won’t need a care home at all. It would never have been a council run one anyway, I wouldn’t do that.

NottinghamKnight

Albermarle said:

Jhuds72 said:

I realise that but she was advised that by selling her house and giving the money to her children, she’d need to keep some to cover possible care home costs or the government will want a load of money.

AS she has  some financial reserves , then the reality is that once she ( and family ) will see their first council run care home , she will be happy to pay privately for something better anyway . So this issue of the 'government wanting a load of money ' will never apply anyway .

I know it's fashionable to say that but in truth there is a huge range, and many well run council homes and terribly poor private homes. Your location in the country is probably far more important in fact.