Moneymakeover retired with excess income, what to do with it??

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gaahead

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I'm looking for some guidance on behalf of an elderly relative.

Personal details

  • Age: 80
  • Marital status: Widowed
  • Children: Four adult children, all financially independent with families of their own.
Financial position

  • Income: Pension income only.
  • Monthly pension: Approximately €4,500 net.
  • Home: Owns their home outright, valued at approximately €500,000.
  • Debts: None.
They live alone and have relatively modest monthly living expenses. Even after regularly helping their children and grandchildren financially, they still have a surplus of approximately €2,000–€3,000 each month, which continues to accumulate in their bank account.

They have built up a significant amount of cash savings. With inflation reducing the value of cash over time, they're wondering what options might be available to help the money grow while still keeping risk very low.

They've had a poor experience with investments in the past, so they are not interested in anything high risk, complex or difficult to manage. Given their age, their priorities are capital preservation, simplicity and easy access to their money, while hopefully achieving a better return than leaving everything in a current account.

What would be the most suitable options for someone in this position?

do we just look at a Raisin account in one of the European banks etc??

Thanks in advance for any advice.
 
4 adult children plus spouse is 8 people

So thats 3k x 8 they can gift each year

Plus say another 4k divvied up across the grand children

So thats the 3k per month sorted (or less if there's an unexpected expense).

also look at opening one or more CU accounts (depending on CU rules). 27k per account can be left to a nominated person outside the estate.

I'm not sure faffing about with Raisin accounts will get much return; given their age I'd be looking at spending the money to make life a bit more comfortable.

Weekly housekeeper, gardener for example.

And I know you didn't ask, but please make sure they have a will plus letter of wishes if appropriate.
 
DannyBoyD said:
given their age I'd be looking at spending the money to make life a bit more comfortable.
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I think this is the only real advice to be given (along with the gifting outlined as well), unless they want to do charitable donations to causes that are important to them. Assuming their monthly income is from guaranteed pensions, there's no risk to their current lifestyle by either spending or giving.
 
He lives a very comfortable lifestyle with 3-4 holidays a year and supports his family well with 3k to each kid annually. He is old school and its money now so he wants to make it work. He is probably a bit of a risk taker based on past investments and some losses but at his age his family are trying to keep him away from anything too risky.

I will need to chat to him to see what he wants is that in trying to set-up things up a bit more for his kids/grandchildren?? With 4 kids and 8 grandkids all should be ok for his estate and will thresholds. Itsmore the circa 100k in the bank that is doing nothing that bothers him..

will etc is all taken care of..
 
What if something happened him and he ended up in a nursing home, his money will dwindle away on costs or through the fair deal scheme if he ended up going that route, he’d be as well to spend it gift it and enjoy life. He cannot bring it with him.
 
niceoneted said:
he’d be as well to ... gift it and enjoy life
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Just FYI:
www2.hse.ie

Financial assessment: How much you pay towards care

Find out how how the Fair Deal financial assessment works and how we calculate your payments towards nursing home care.
www2.hse.ie www2.hse.ie

Transferred Assets​

The financial assessment includes any assets you have transferred:
  • in the 5 years before the date of your first application
  • on or after the date of your first application
If you have given any land, property or money to another person in the last 5 years, you will need to tell us. You will also need to tell us if you transfer any property, money or land after you make an application.
Click to expand...
 
Thanks folks, while he is good health and active currently that is something to consider down the line. Keep some of the cash with easy access is something to consider. I think raisin and some high interest accounts is definitely something to look into as he has to do a tax return each year for his pension so adding dirt is no big deal..

@DannyBoyD agree I dont think fair deal is a runner as his pension and kids will cover most of the costs if needed.
 
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