Elderly care

Another POV is, "I worked hard all my life to get that and want to give it to my kids, whilst some other feckless person was sponging off the state (aka me the hard worker) and gets the same level of care, so why would you (the govt) advise my kids to get a job or save?"

I suppose the answer has to be, old person gives home to kids more than (7?) years before they die and hope the kids dont chuck 'em out. (Not sure if it needs to be as long as 7 from that aspect?)

The German method also works:

The kids always pay for the needs of their parents whether they are in line to inherit or not.

Seems fair to me, not sure that it is politically workable.

tim

Can you explain more? Sounds amazing. Suppose you hated your parents, you had a miserable childhood, how would that work? Do they just deduct the money from your wages or what? And how do they divvie up the costs between children? And at what age does this start? When you reach retirement age? tell us more!!

The basic rule is quite simple. If a person can't pay for their care in old age their children are legally required to care for them (either personally or by meeting the bill for a third party to do it)..

Of course, this being the land of obeying rules Germans take step to be prepared for it and in most cases it is just done in much the same way that people everywhere expect to look after their offspring as children.

I've no idea how they enforce it against someone who won't pay for it voluntarily, but they do. I remember reading a case in a UK paper about someone half German born in the UK, being sued in the UK for the cost of his parent's care after they had gone home to retire.

When I was working in Germany confirmed with my colleagues that this was the rule. In the main they were surprised that we didn't have a similar requirement, as it seemed so natural to them (which if you think about it, it is)

tim

I wonder what the outcome was?

I dont think its natural at all. I can also think of several million reasons why its a bad idea but might change my mind as I get older :-)

If the parents continue to live in the house then it is a "gift with reservation" - not a gift at all.

If they give a portion of the house to a kid who moves into the house with them, then no "gift with reservation" - 7 years later the gift falls out of IHT.

Right but that is for IHT, I wonder what the rule is for paying for care home purposes? ISTR reading it was a year but not sure.

You don't think that we kindof do a version of this in reverse in the UK - kids expect the house and not to have to look after eldelery parents.

"If the parents continue to live in the house then it is a "gift with reservation" - not a gift at all. "

It's not a gift for inheritance tax purposes, I agree. But it is a gift for capital gains tax purposes. This gives the 'worst of both' scenario. IHT will be payable on the value of the house at the date of death, plus CGT will be payable on the incease in value since the date of the gift.

Robert

"tim (back in SY)" wrote

There's a difference though - every child has parents, but not every old person has children.

What happens to those old people who can't pay and don't have any children to foot the bill?

Also, some parents give up their children for adoption and then don't expect to "pay for their offspring". Can people give up their old parents to be "adopted"??!

What happened before we had a welfare state?

What happens in developing countries that have no welfare system?

Which are?

I accept that moving to the system is hard.

But if you've always had the system it seems fairer.

It's not the oldies that notice the difference.

tim

The German's are noticing this.

They are considering charging them a tax surcharge. Seems unfair to me, they should get a rebate for the education savings.

No idea.

tim

"tim (back in SY)" wrote

But at what age should that tax charge start? Eg - just because you don't have kids by age

30 or 40 doesn't mean you won't have any later!

"tim (back in SY)" wrote

Yep, agreed - and people who are always employed/self-employed should get a rebate from unemployment benefit savings, and people who never go to the doctor/hospital should get a rebate from NHS savings, etc etc.

If you have a choice between losing 40% of it in IHT and 100% of it in care home fees, which one are you going to choose?

But the low birth rate in Germany is causing more problems than just this, so they wouldn't want to encourage it further.

[]

That's an old Miles Kington story:

Son goes out for dinner with parents to celebrate his 21st birthday:

Son thanks parent for bringing him up and how he'll always be in their debt. Parents explain how they don't want him wondering how much he owes them, and produce a ledger book _Son's Childhood_, totaling XX,000 GBP.

Son flicks through it and sees entries "Donkey & Ice cream, Blackpool Beach June 1970 : 85p", "School Trip 1972: £2.50", "Second-hand mini,

17th Birthday £500" etc, etc.

Son says "Oh, Ok then, I guess I better pay for *this* meal", and opens a brand new blank ledger labeled _Aged Parents Declining Years_ , enters opening balance and first transaction... ;-)

rgds, Alan

Very few people lived long enough for this to be a need. Old people (aged maybe 40) got ill and died. End of story. In later times, for those that had an elderly person living with them , it just meant (say) 12 people in the one room hovel instead of 11, plus some inbuilt child care so the parents and younger kids could work more. In any case, they only had to pay for food, not for someone else to house and feed and care for the parents, so any financial aspect was minimal. Chnaces are the lack of food and warmth would ahve done for them pretty quick so they would only have been around for a few years, not for 20 or 30 or more. I see people in care homes now adays who wouldnt live more thana few weeks if they didnt have round the clock nursing care, feeding etc. People are living well beyond the time that evolution equipped their bodies to last for. This has probably only been a problem for the last 50 or so years.

See above.

1) fairness to the children. Think of all of the different permutations of numbers of children, their earning ability, their domestic situations. Either they will be disproportionately affected by a flat rate tax, or an incredibly complex algorithm that will make the child tax agency look like childs play will come into play (and that will also not be fair). 2)fairness to dependents of the children. Their circumstances will be adversely affected by something out of the control of the children, that is, when and how much care the parents need. 3)inability to take account of the kind of parents they were, for example parents are bastards to their children as they grow up, just staying on the right side of child abuse, then squander their inheritance, then effectively force them to pay to look after them. Maybe just hopeless crap 'chav' parents who give their children little help growing up..why do those children owe them anything at all? 4)no incentive to earn more if taxation will increase, esp if its to pay for something you resent (see (3)), hence if payment is means related, it can be throttled back until the parents depart this mortal coil. 5) reduced incentive for parents to save for old age if they can splurge it all and then forceably sponge off their kids. .. some reasons omitted for reasons of bandwith .. 3,654,376) Evadeable..."goodbye Germany", maybe "goodbye EU".

Would be interested to know how they deal with the first (3). I also read the other day about a law whereby (maybe just in Bavaria?) every householder had to pay for a chimney cleaner to vist so many times a year, even if they didn't have a chimney (!!!) and this was causing resentment and so maybe things are changing in Germany in respect of old customs?

I can imagine.

Alan Frame wrote

If it is an *old* Miles Kington story, I wonder how old he is now, and what are his current attitudes? ;-)

I'm 72, still fit, and in better shape financially than two of my adult children, largely because they spent their money as it came, or rather slightly faster than it came! I heard Mr Micawber, and kept my spending down to 19/6d.

One of my children is in America, and one in California, unfortunately the one who knows how to handle money.... The daughter who lives 'within reach' (1/2 an hour) has just off-loaded her 4 figure credit card debt by adding it to her mortgage, which wipes out three years' equity gain, and is moving in with her third relationship partner, planning to rent out her own house. 8-(

What should I be doing? IHT won't enter into it, with a £170k house and a few ISAs. My inclination is to sell, get into secure rented accommodation in a pleasant area which excludes anyone under 55, and spend the lot, at least down to the limit which precludes me paying Nursing Home fees.

Voluntary Euthanasia if and when I need someone to change my nappies is just a dream. ;-)

No it doesnt. It just makes it plain that she spent that already. Which may or may not have been sensible but moving it to lower cost debt seems like a plan.

Why the sad face? Presumably she will cover the mortgage or more, perhaps enabling her to pay off those 'credit card' bills (now subsumed in the mortgage). Certainly it should make her financially better off anyway.

I suppose that is 20+ years at 750 a month so that seems like a viable plan. There was a woman in the news a few years back, she was continuously sailing round the world on the QE2 on the grounds it was cheaper than renting!

Murder Inc?