Personal weekly allowance

[Pat12ka]

My mum has been in a care home for the last four years and has been self funded. Mum’s money has now got below £23,000 and the LA are contrubuting to the fees. I have POA and manage my mum’s money. Mum’s dementia is very advanced and she can no longer communicate, read, watch tv, etc. Her clothes and toiletries are purchased by the family (birthday and xmas presents), and she isn’t able to go to the hairdresser. Chiropody is free. She will be using very little if any of her £24.90 personal allowance. I am quite confused about what happens to this money if my mum doesn't spend it. Will it accumulate and be part of her assets/capital and taken into account by the LA when the money gets to £14,250. Can I/ should I, take this money out of her current account and put it in a savings account?
Sorry if I haven’t explained myself very well. I would appreciate any help that the members can give me.
Thank you. Pat.

 

[jenniferpa]

Personally, I’d start using some of the money for her clothes etc rather than paying for them yourself. If you do let it accumulate you’ll end up paying more in tariff income (that’s where you pay £1 per week per £250 of savings. In fact that’s the fiscally more responsible thing to do, because there is no way you could make that in a savings account.

 

[Sirena]

I'd try to use it up as Jennifer says - toiletries, clothing, a warm bedspread, music CDs, anything that will make her life more pleasant.

 

[Wifenotcarer]

My Uncle spent his last 5 years in a care home, fully funded by the local Council as he had no other income than his state pension. We didn't give a thought to his 'pocket money' and were perfectly happy to buy his clothes, pyjamas, toiletries, etc. as presents, always took biscuits and sweets when we visited and bought him a 2nd hand TV for his room. We even bought presents for him to give to the staff at Christmas. Imaging our surprise when he died and the home contacted us (me and my sister) as his sole heirs to give us what was left in his account - approximately £4000 + interest accrued. As he neither smoked nor drank and refused to buy a newspaper when he could read someone elses the only thing that had been bought from the money was a £1,000 hospital bed, which he only used for the last few months. Technically, we could have claimed the bed back but chose to 'donate' it to the home.

 

[Beate]

Please don't remove money from her account and put it in one not in her name - that would be deprivation of assets. If you simply move it from her bank account to her savings account, it's still part of her assets.

If you don't want it to accumulate, the easiest thing really is to start spending it on her. If you don't, you will get it back via inheritance at some point anyway. She won't know if presents for her have been bought by her own money, and this way you won't go over any thresholds.

 

[witts1973]

Personally, I’d start using some of the money for her clothes etc rather than paying for them yourself. If you do let it accumulate you’ll end up paying more in tariff income (that’s where you pay £1 per week per £250 of savings. In fact that’s the fiscally more responsible thing to do, because there is no way you could make that in a savings account.

Hi Jennifer,what is this tariff income?Does that work the same with care at home fees when you get to a certain level?Is that ate £22,250 and do you know how it works?

 

[Pat12ka]

Please don't remove money from her account and put it in one not in her name - that would be deprivation of assets. If you simply move it from her bank account to her savings account, it's still part of her assets.

If you don't want it to accumulate, the easiest thing really is to start spending it on her. If you don't, you will get it back via inheritance at some point anyway. She won't know if presents for her have been bought by her own money, and this way you won't go over any thresholds.

Thank you for your reply and for answering my question. I thought that the money would still be part of her assets but wasn’t sure. I won’t be moving any money fom her account.

 

[jenniferpa]

When you have between the upper and lower limits, you are expected to pay £1 per £250 of savings every week as well as the majority of your pensions. So if your mother is accumulating her personal expense allowance she will actually be paying more.

Edit: just to clarify, tariff income does not apply to care in the home.

 

[nitram]

Another approach would be to buy a funeral plan, this would mean that the accumulation of the PEA would not cause the lower asset limit to be reached for several years.

 

[Beate]

While this is perfectly legitimate and takes several thousand pounds out of the equation at once, I would advise caution and to read the small print of every funeral plan. Some can actually work out more expensive than a funeral once someone dies, and often you are obligated to use a particular funeral director etc. In every funeral plan there are things included you might not choose if they weren't part of it, and funerals these days get more bespoke, with direct cremations on the rise. So do your research.