General financial advice for elderly man

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Mayfield05

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My father is 80 and I'm looking for some advice for him.

He lives with my sister (unmarried and never left the house) and they both looked after my ill mother for the last 15 years. She died in February. He has a good pension, second property small amount of cash and while not loaded he is comfortable.

The house that they live in is valuable and he wants to update it as they could do nothing with it while my mother is alive, so he needs a cash injection. He is talking about selling the second property so that he can update the family home, the cost of which will be substantial.

I'm concerned that he won't get financial advice. If my father gets sick and needs care the second home was going to pay for it. The objective is how can my father mobilise his assets in the most tax efficient way so that he can live comfortably for the rest of his days. There are 4 children and we all want to make sure he has what he needs. He is in the full of his health both mentally and physically. He won't sell the family home as my parents want this to go my sister who lives there but we are concerned that he hasn't thought it through properly.
 
Mayfield

I am not sure how much there is to advise him on here.

If he is 80 and in good health, he could easily have 10 or 15 years left to live.

If he had only 5 years left to live, there might be some value in holding onto the investment property because the capital gain would disappear on death which would benefit his children.

But he has to update the house, and that takes priority over clever financial planning.

How much will the refurbishment cost? Could the children lend him the money? That would be the best way to do it.

Alternatively, he could take out a life loan but with interest at 5%, that does not seem like a good idea.

But as Sue points out, we are shooting a bit in the dark without all the information.

Brendan
 
If your father gets sick and needs to go into a nursing home, he will benefit from the Fair Deal Scheme.

If he has extensive investments or investment income, he will have to pay a good part of it himself.

Brendan
 
Thanks everyone for your help. Apologies for the vagueness, but I'm not close to his finances in relation to figures. He's extremely independent and I don't want him to think I'm prying. I did have another chat with him and he said he can offset some losses he incurred with shares a few years ago against the gains from the house which helps. He also told me he would go to an accountant once he knows how much he will get for the second house. He sacrificed everything to look after my mother who was very ill for many years and I just want him to live in comfort for the rest of his life. Aside from my sibling who was also a carer for my mother, being provided for when my father goes, with the family home noone else cares about what's left which is a relief. We'd be happy if he spent the lot on a good life. The only income he has is a good pension. He doesn't have any other investments that he gets money from. I'll ask him to find out about us lending him the cash. He hasn't worked out the cost of refurbishment yet. I honestly don't think he's thought it through. He's still grieving and he just wants to plough ahead which is why I wanted to give him a good steer. Many thanks indeed for the advice thus far. It's much appreciated.
 
Mayfield05 said:
Thanks everyone for your help. Apologies for the vagueness, but I'm not close to his finances in relation to figures. He's extremely independent and I don't want him to think I'm prying. I did have another chat with him and he said he can offset some losses he incurred with shares a few years ago against the gains from the house which helps. He also told me he would go to an accountant once he knows how much he will get for the second house. He sacrificed everything to look after my mother who was very ill for many years and I just want him to live in comfort for the rest of his life. Aside from my sibling who was also a carer for my mother, being provided for when my father goes, with the family home noone else cares about what's left which is a relief. We'd be happy if he spent the lot on a good life. The only income he has is a good pension. He doesn't have any other investments that he gets money from. I'll ask him to find out about us lending him the cash. He hasn't worked out the cost of refurbishment yet. I honestly don't think he's thought it through. He's still grieving and he just wants to plough ahead which is why I wanted to give him a good steer. Many thanks indeed for the advice thus far. It's much appreciated.
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perhaps your siblong that is due to inherit the house could contribute towards this as they will be a beneficiary of this outlay anyway.
 
Blackrock1 said:
perhaps your siblong that is due to inherit the house could contribute towards this as they will be a beneficiary of this outlay anyway.
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They wouldn't be in a position to do that as they are unemployed. They've lived in the house all their lives and cared for my mum with dad. If they had not been there she would have gone into a nursing home which she would have hated. Therefore they want her to get the house on their death.
 
Mayfield05 said:
They wouldn't be in a position to do that as they are unemployed. They've lived in the house all their lives and cared for my mum with dad. If they had not been there she would have gone into a nursing home which she would have hated. Therefore they want her to get the house on their death.
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understood, hopefully they have the necessary arrangements in place to leave the house to that sibling without he or she incurring CAT.
 
You also need to consider Fair Deal in the implications of any actions you take and in particular the 5 year rule. Its great he is well now but in a number of years time, that could be a different case.
 
I would be inclined to sell the second property and use the proceeds to upgrade his main residence. Make it more comfortable and warmer if there is scope to do so.

If he needs nursing home care in the future, his PPR is only part of the financial assessment for the first three years. Whereas a NPPR or cash or investments would be part of the assessment for life or until the money runs out.

In addition, your sister will inherit his PPR tax free if she qualifies for the dwelling house exemption which it sounds like she does. If there are substantial assets which would put her over the CAT threshold, this relief could be very valuable.
 
If its an extensive refurbishment of the house, some assistance is available re SEAI grants, which the family should have a look at. For example, installing a heat pump + changing all windows and doors, and also getting up to a B2 BER certification, attracts about 16k, in SEAI grants, if you are in addition, adding a wrap around ,+ underfloor insulation, +PV + attic insulation, etc, the grants totals roughly 36k.

www.seai.ie

One Stop Shop Service

A complete home energy upgrade solution for homeowners. Find out more.
www.seai.ie www.seai.ie

There are also means tested grants available from county councils for over 65’s, check your local county council, for more details.

EG:

Grants for Homeowners

Information on the various grants available to homeowners
www.dublincity.ie www.dublincity.ie
 
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