Plan for the future and fear the worst

IDGOM has been on the back burner a bit in recent weeks because we have been researching dementia specialist care homes for MIL.

The manager of the residential home where she lives has told the family that they cannot any longer offer her the care she needs, following a diagnosis of Alzheimer’s in March this year, and that we need to look at alternative services from the New Year.

We have always known that it was not a specialist dementia home, and that this moment could come at any time, but it is still one hell of a shock.

How on earth are we going to explain to someone who often doesn’t know what time of day it is, let alone what day, that they are having to move because their home of the last five years is no longer able to look after them?

And that their meagre savings will pretty soon be swallowed up because residential dementia care starts at more than £1,000 a week? One place we looked at cost £1,400.

When the decision was taken, by them, to move into residential care in 2011 because of FIL’s increasingly frail physical health, their home and investments were sold at their request to buy annuities.

They did not want their children to face an uncertain financial future should the money run out and annuities seemed to be the way to go.

As they were not multi-millionaires their money only paid for non-index linked annuities that covered around 85% of the cost of care.

But the balance was made up by their state pensions and attendance allowances, leaving them with some savings to cover every day items such as clothes, telephone rental, life insurance, treats etc.

Five years on and after average 4% increases in fees each year, adding around £40 a week to costs while pensions have risen by a few pounds a week, those savings are almost gone.

I’ve not mentioned all this because the family wants sympathy. This is not a unique situation and after all, MIL and FIL chose to go into privately funded care. And surely there is help available from a variety of sources?

Erm, no. The local councils treat the annuities as income, even though it can only really be used for care (she could live independently and receive the annuity income but this would then be taxed).

So in their minds MIL is a very well-off 89-year old, with an annual income well above the national average salary.

Her professional body can’t help either because, again, she has a substantial monthly income.

So, the moral of the story is that you are likely to die penniless if you work hard all your life, save for your retirement, don’t ask the state to help you early on with care needs and if you get unwell enough to require specialist care.

A sobering thought that my reader would do well to take on board.