I'm an only child caring for my mother - finance questions

[Soli99]

Hello, I was going to post a long financial post related to both my mothers and my finances but decided I'd start with a post about my financial situation as a carer and see if anyone has any views, recommendation or can raise anything I may have missed.

Fifthteen month ago I started caring for my mother the day my father died, two weeks later she was officially diagnosed as having Alzheimer's. Some time later I became an official carer.

Prior to my world turning upside down I had run my own IT related company and things were going along fairly well. I was living by myself in my own house a few miles from my parents. I was slowly working on the house and getting it in to a good state of repair bit by bit. Overnight things changed, I had to drop all work and move in to my mothers house. She couldn't really be left alone at the time and certainly can't now.

So here I am, 15 months later still caring for my mother who obviously is getting slowly more difficult to manage. Her sister helps when she can but has her own family medical issues. My mother visits a moments cafe (2hrs) once a week and attends a day center once a week. I have thought about getting a carer in but my mother other than having a terrible memory especially short term is otherwise still fairly with it and I think (know) she would bulk at the idea.

I had powers of attorney since day one, and took over my mothers finances, this involved managing her bank savings and bills but also transfering my late fathers savings and SIPP to her. I also got Attendance Allowance sorted, blue badge, Council Tax for my house was reduced to 0% and my mothers has been reduced by 50%. I now receive carers allowance of £76pw

Obviously the £76 carers allowance isn't enough to live on as I am still having to fuel the car, pay insurance on the car and house, pay bills on my house (boiler set to min to stop damp) .......... So in short over the last 15 months I've had very little coming in and have been living off my savings which has shrunk by a fair bit. As far as I can tell I can't claim anything else because I have savings but I am worried that over time these will dwindle and my nest egg will disappear, money I planned on using for holidays, buying good and was due for my own retirement.

After a few chats with her sister I decided that I should take half of the attendance allowance money because I was paying for all the fuel driving mom around, paying a lot of the bills for coffee shops and such like. I was also obviously looking after her house, living in her house, doing the gardening, the cooking, the shopping and so on.

It has been mentioned I could take up to £3000 out of moms account each year tax free but even though I have powers of attorney I'm not sure how I feel about this. The idea was it gives me some extra cash but also reduces moms savings in a legitimate way. Mom isn't very financially savvy so even trying to discuss this with her is difficult.

So here I am looking for idea's as to what I can do, if anything. Is there anything I've missed ?

I should mention if I was to return to work I would have to work 5 days a week otherwise it just wouldn't work out.

Thanks for any info.

Steve

 

[nitram]

The £3k/yr is related to IHT , deliberate deprivation of capital in any future financial assessment is a different matter.
In your circumstances taking all the attendance allowance could be reasonable, as LPA it would be wise to get this checked with the OPG

You can reduce mother's savings by taking out a prepaid funeral plan

 

[Soli99]

Great thanks for the info Nitram I'll give the OPG a call just to check I'm not doing anything that might come back to bite me. I'll have a look at the 3K and IHT planning as my father mentioned it sometime before he died.

The prepaid funeral plan is something I've never even heard about so I will certainly have a look at that !

Thanks

Steve

 

[nitram]

The prepaid funeral plan is something I've never even heard about so I will certainly have a look at that !

Not all plans are accepted by all funeral directors, so best check with funeral director if known.

 

[sdmhred]

Hi @Soli99

Are you able to rent your own house out to generate some income? I‘ve been in a similar position but was able to work just enough to pay the bills. I wasn’t able to rent mine but you might?

in terms of day to day costs….mum paid the petrol costs for driving her around as well as things like the coffees. Although I have POA she was able to vocalise that was reasonable due to the care costs I was saving her so buying me a coffee a few times per week was perfectly reasonable,

I think you are perfectly reasonable to request taking some of the AA. Calculate what your mum would have to pay if you didn’t do the cooking, gardening etc. the deal you offer is in her best financial interests!

take care xx

 

[Soli99]

Hi @sdmhred thanks for the response. I did consider renting. The problem at the moment is that I was half way through doing the house up and have only managed to do a bit more recently. I could get someone in to finish it but the decorations and furniture I have in the parts I've completed were for me and not really intended for the rental market. I'd be concerned about damage to the tables and new kitchen and so on.

Thanks

Steve

 

[ged626red]

Hi Soli 99,
as you are getting the appropriate benefits already reducing your mothers savings would not make any difference whatsoever. The only means tested ie takes into acct capital over a certain limit - is Council Tax so as you get this already reducing her capital will not make any difference. The only thing is to do with Pension Credit - which is means tested but even if your mother has £30,000 she may well still qualify. I would give them a ring.


Pension Credit tops up:

• your weekly income to £201.05 if you’re single
• your joint weekly income to £306.85 if you have a partner

If your income is higher, you might still be eligible for Pension Credit if you have a disability, you care for someone, you have savings or you have housing costs.

What counts as income​

Your income includes:

• State Pension
• other pensions
• earnings from employment and self-employment
• most social security benefits, for example Carer’s Allowance

What does not count as income​

Not all benefits are counted as income. For example, the following are not counted:

• Adult Disability Payment
• Attendance Allowance
• Christmas Bonus
• Child Benefit
• Disability Living Allowance
• Personal Independence Payment
• social fund payments like Winter Fuel Allowance
• Housing Benefit
• Council Tax Reduction

If you’ve deferred your pension​

If you’re entitled to a personal or workplace pension and you have not claimed it yet, the amount you’d expect to get still counts as income.

If you’ve deferred your State Pension, the amount of State Pension you would get is counted as income.

You cannot build up extra amounts for deferring your State Pension if you or your partner are getting Pension Credit.

Your savings and investments​

If you have £10,000 or less in savings and investments this will not affect your Pension Credit.

If you have more than £10,000, every £500 over £10,000 counts as £1 income a week. For example, if you have £11,000 in savings, this counts as £2 income a week.

I hope this helps. 0800 99 1234. If you dont ask you dont get!

 

[Violet Jane]

@ged626red, it appears that @Soli99 is under pension age.

@Soli99, I'm not as sanguine about just taking sums from your mother to top up your Carers Allowance, however paltry it is. You are her financial attorney and can only be reimbursed for your reasonable expenses (not time - only certain professional attorneys can be paid for the work they do managing the PWD's affairs) relating to her. You should keep records (and receipts) relating to sums spent and sums reimbursed. It's obviously more difficult with things like the car because it's partly for your own use and partly for hers. I don't think that your mother should be paying anything towards your house.

 

[Firecatcher]

Unfortunately carers to end up in a very difficult financial position often compromising their own income and savings. You really need to consider your own financial position and what you’re giving up as people can live with Alzheimer’s for a long time.

I have very mixed feelings about POA. In many respects it’s a good thing but the expenses you can legitimately claim are minimal and essentially the POA is providing their services for free.

I’ve spent in excess of three hours sorting out POA stuff for my parents this week. All I can claim for is parking and stationary. I work a combination of contracted work and freelance. I won’t be able to claim for the hours - that’s considered a labour of love. Similarly I can’t claim the petrol costs of a lengthy journey to visit my parents because that’s seen as a welfare visit even though I’m acting as an unpaid taxi driver, cleaner and gardener whilst I’m there and have given up a days work.

I’m also an only child and am starting to struggle with the additional expenses I’m incurring.

 

[Bod]

@Soli99
The real answer lies with, how big are your mothers assets and income.
Should she have enough to pay, say £4,000 a week for residential care for the rest of her life,(20+years).
Then paying you a realistic allowance should not be a problem.
However should her assests be below £23,000, and her only income be state pension, then there is a very different situation. (£23,000 is the upper limit where the Local Authorities start to get involved with paying for Care.
Renting your house out, have a Letting agent view the property, this will give you the knowledge of what will need to be done to make the property rentable, and an idea of income from it.
Yes, having an agent will cost, but they take the hassle of dealing with tenants, trades people when required, and their fees are tax deductable. (and maintance costs)

Bod

 

[Soli99]

Hi ged62red, thanks for the info. Unfortunately I'm still a way off getting my pension. I do have a SIPP but I don't really want to making use of that yet. Thanks for all the info though

 

[Soli99]

@ged626red, it appears that @Soli99 is under pension age.

@Soli99, I'm not as sanguine about just taking sums from your mother to top up your Carers Allowance, however paltry it is. You are her financial attorney and can only be reimbursed for your reasonable expenses (not time - only certain professional attorneys can be paid for the work they do managing the PWD's affairs) relating to her. You should keep records (and receipts) relating to sums spent and sums reimbursed. It's obviously more difficult with things like the car because it's partly for your own use and partly for hers. I don't think that your mother should be paying anything towards your house.

Thanks Violet Jane, I do keep receipts when there is one available. I also tend to write down any expenses in a book so I have some details of what has been spent and any money I have taken back.

Regarding my house I certainly don't take anything at all for that. I've only taken money where I've had to pay for things on my mothers behalf or where I've had to transport her somewhere that I wouldn't normally be going.

 

[Soli99]

Unfortunately carers to end up in a very difficult financial position often compromising their own income and savings. You really need to consider your own financial position and what you’re giving up as people can live with Alzheimer’s for a long time.

I have very mixed feelings about POA. In many respects it’s a good thing but the expenses you can legitimately claim are minimal and essentially the POA is providing their services for free.

I’ve spent in excess of three hours sorting out POA stuff for my parents this week. All I can claim for is parking and stationary. I work a combination of contracted work and freelance. I won’t be able to claim for the hours - that’s considered a labour of love. Similarly I can’t claim the petrol costs of a lengthy journey to visit my parents because that’s seen as a welfare visit even though I’m acting as an unpaid taxi driver, cleaner and gardener whilst I’m there and have given up a days work.

I’m also an only child and am starting to struggle with the additional expenses I’m incurring.

Hi Firecatcher, it sounds like you have a similar job to what I previously did. I was a freelance IT contract and was doing fairly well. Unfortunately my father died and I had to leave the contract immediately and with my mothers condition there is no way I could even consider returning to contracting at the moment. For example yesterday I was woken several times during the night when my mother was confused about the time and where she was. We eventually got up and 7 and she immediately wanted to go out! After sorting out the breakfast and washing an so on we went out so she could have a little walk and she demanded we get a coffee. We then got home and I cooked lunch and I got some time (with her) to pop over to my house, bag up some garden waste and get over to the tip. I then got back and tried to find someone local to look after her feet (previous woman just retired). I also spent some time making sure the spreadsheet of her finances is up to date and cleaned the house. I will cook her dinner and I'm expecting tonight that she will get upset about 6-7 because she thinks her parents are still alive and that will continue until sometime between 11 and 1. She will no doubt demand to go out and try and look for them (they died 30+ yrs ago).

Obviously on top of this I have to deal with POA stuff like paying bills, insurance, still dealing with the carry on of my father dying and so on. I'm also now in charge of my mothers SIPP (previously my fathers) as the previous money grabbers were taking 3-4K a year in expenses.

I'm not really concerned too much about expenses relating to POA stuff, its more the everyday living type of things, basically being the carer, £76 just come close to covering it all and then leaving me money for my normal expenses on top of carer related expenses.

 

[Soli99]

@Soli99
The real answer lies with, how big are your mothers assets and income.
Should she have enough to pay, say £4,000 a week for residential care for the rest of her life,(20+years).
Then paying you a realistic allowance should not be a problem.
However should her assests be below £23,000, and her only income be state pension, then there is a very different situation. (£23,000 is the upper limit where the Local Authorities start to get involved with paying for Care.
Renting your house out, have a Letting agent view the property, this will give you the knowledge of what will need to be done to make the property rentable, and an idea of income from it.
Yes, having an agent will cost, but they take the hassle of dealing with tenants, trades people when required, and their fees are tax deductable. (and maintance costs)

Bod

Hi Bod,

I really don't want to be letting my house if I can avoid it as its time I don't have to sort it out, I've had very bad experiences with trades people hence why I was doing the work myself. Finally a neighbour several doors up has just had a fair bit of damage caused to her house when a tenant decided to leave one night. I've also got the issue of storing all of my stuff which there is a fair bit. In some ways I'd rather just sell the house than rent it because I know I can make a reliable 5%+ on the market given a fair period of time.

Even getting time to deal with tradespeople would currently be a nightmare as dealing with my mother is basically a 24/7 job. If I had brothers/sisters or we had a bigger family then it would be a lot easier thats for sure.

As for my mothers assets she has some savings a fair bit above the cut off and also a SIPP which is growing fairly well now I'm managing it rather that so call Financial Advisors. So yes she has some money but I don't really want to be using it as its hers and I don't think she should be paying me.

 

[sue31]

Thanks Violet Jane, I do keep receipts when there is one available. I also tend to write down any expenses in a book so I have some details of what has been spent and any money I have taken back.

Regarding my house I certainly don't take anything at all for that. I've only taken money where I've had to pay for things on my mothers behalf or where I've had to transport her somewhere that I wouldn't normally be going.

Not sure if you’ve said on other posts - do you have enough qualifying years in your state pension to get the full rate when you hit retirement age? If not definitely look into that now rather than later.
Can you sell your house? Would you remain in your mother’s home if she was moved into full time care? Or sell it & go back to yours?

So many options and ways of looking at this.
If your cars only being used to ferry your mum around I wouldn’t have thought it would cause any problem to buy fuel or take a contribution towards the cars upkeep, obviously in a reasonable basis as it’s for her benefit.

As others have said, She can legally give the £3000 away each tax year - we did this, 3 siblings have 1000 each. I believe it’s only an issue if doing so is with the intent of depravation of assets. As Mum had well over the threshold & it’s barely even making a dent in her finances. We use the money when we take her out for family days & for extra treats. I think all 3 of us spend well over that 1000 during a year!

Think you need to take a good look at all her assets before you do anything. However with the 3000 you can take the previous years allowance if not already taken. So up to this April you could take 6000, 2023/4 and 2022/23.

If you were to take her away for a weekend/week if funds allow she can pay for you too as her carer.

It might be worth meeting with a reputable financial advisor, with the figures relating to all your mums accounts if your worried.

 

[canary]

Hi ged62red, thanks for the info. Unfortunately I'm still a way off getting my pension. I do have a SIPP but I don't really want to making use of that yet. Thanks for all the info though

Just checking because I cant remember - are you claiming Carers Allowance?
Its not a huge amount, but better than nothing and it does pay your NI so you are not missing out on your state pension

 

[Soli99]

Not sure if you’ve said on other posts - do you have enough qualifying years in your state pension to get the full rate when you hit retirement age? If not definitely look into that now rather than later.
Can you sell your house? Would you remain in your mother’s home if she was moved into full time care? Or sell it & go back to yours?

So many options and ways of looking at this.
If your cars only being used to ferry your mum around I wouldn’t have thought it would cause any problem to buy fuel or take a contribution towards the cars upkeep, obviously in a reasonable basis as it’s for her benefit.

As others have said, She can legally give the £3000 away each tax year - we did this, 3 siblings have 1000 each. I believe it’s only an issue if doing so is with the intent of depravation of assets. As Mum had well over the threshold & it’s barely even making a dent in her finances. We use the money when we take her out for family days & for extra treats. I think all 3 of us spend well over that 1000 during a year!

Think you need to take a good look at all her assets before you do anything. However with the 3000 you can take the previous years allowance if not already taken. So up to this April you could take 6000, 2023/4 and 2022/23.

If you were to take her away for a weekend/week if funds allow she can pay for you too as her carer.

It might be worth meeting with a reputable financial advisor, with the figures relating to all your mums accounts if your worried.

Hi Sue31, yes I've just got enough years so all good on that front


I have considered selling my house however a solicitor warned me that if my mom moved into a home I would have to sell her house and then deal with finding somewhere for myself again. Sounded potentially a bit stressful.

I actually took my mom away early last year for a week and paid for most of it. Really I should have used some is her money as the trip was for her really and it certainly didn't feel like a holiday for me.

I will have a think about the £3k because my mother has a home to sell in future, a sipp with a fair bit in it and a fair few savings left by my father.

 

[Soli99]

Just checking because I cant remember - are you claiming Carers Allowance?
Its not a huge amount, but better than nothing and it does pay your NI so you are not missing out on your state pension

Yes got it thanks, as you say not a lot! Frustrating I got nothing over COVID from the government when I was running my company, have paid loads of tax over the years and basically sod all support when I need it

 

[sue31]

Hi Sue31, yes I've just got enough years so all good on that front


I have considered selling my house however a solicitor warned me that if my mom moved into a home I would have to sell her house and then deal with finding somewhere for myself again. Sounded potentially a bit stressful.

I actually took my mom away early last year for a week and paid for most of it. Really I should have used some is her money as the trip was for her really and it certainly didn't feel like a holiday for me.

I will have a think about the £3k because my mother has a home to sell in future, a sipp with a fair bit in it and a fair few savings left by my father.

It might be worth looking into this further - I’m not sure what you age is or what assets your mum has but it may be a case of her home not being counted when doing a financial assessment for care or care home

When a house won't be taken into account


There are some situations where your home will not be taken into account, even when paying for care home costs. This is when one of the following people also lives in the property, and will continue to live there after the person has moved into a care home:

• a husband, wife, civil partner or partner
• a close relative over the age of 60
• a dependent child
• a relative who is disabled or incapacitated.

The person's house might also be the permanent home of someone who has been caring for them, such as a friend.


For as long as the carer is living there, the local authority has discretion to decide whether or not to include the value of the home in the assessment.


This is more likely to apply in cases where the carer has given up their own home to care for the person with dementia, but it is not mandatory.


So………
Reading in various places it would seem like you could sell up your home and if willing remain in her home with carers or stay there if she did go into full time care.

---

 

[Soli99]

Ah interesting, thanks Sue31 I will have a bit of a look into this. I'm based in Solihull so will look to see if I can find similar cases in the area.

Thanks for the info