You spend a large portion of your life working hard so you can be setting aside savings for your retirement years and possibly leaving some inheritance for the next generation. No one knows what the future holds and how your health will fair which could rob you off your intentions.
With my mother being very ill I was introduced into a whole new world of high care and the exorbitant prices being charged. I have heard of horror stories with the elderly handing over their properties in exchange for a place in a elderly home so this is nothing new. A friend of mine in South Africa recently had his dad admitted into a high care home and when he told me the costs I was a little stunned. His monthly bill was R68K or £2.9K monthly which is expensive considering what R68K could buy locally and not converting into other currencies as everything should be relative. This monthly cost for the average person would not be possible and is only affordable for the top 1%.
My mothers curve ball at her age is going to cost £7K monthly which is roughly 2.5 x more expensive than SA's cost and may as well be £100K monthly as she cannot afford this. What this ultimately means is all of her life savings are now forfeited to the local council who will now pick up the monthly bill. Is this fair or even reasonable I don't really know because it sounds like a rough deal, but that is how things work. We always say there is no budget when it comes to family yet in this case the costs are so extreme I cannot step in. When someone is proud this is tough because in some ways they do not want to be a burden and this is the last thing they really want, but have no choice.
The UK Government in 2023 placed a cap on healthcare setting this figure at £86K over a lifetime. My mothers high care bill would be £84K per year and after that the Government would fund the cost no matter what. No one from the council has phoned my brother or myself yet and apparently we should be expecting a call. The £7K just sounds seriously expensive and someone is coining a huge profit from this.
The only way that her funds could have been protected was if she had a trust fund and that s obviously a little too late to change thigs now. I some ways I think we are lucky that the UK has this sort of facility available because this is not the same in South Africa even if you have private medical are as that R68K fee is with someone who has the top private medical plan available. This kind of sucks and luckily the family can afford these extra expenses.
What I am doing is creating a trust fund for the grand kids which will be given to them at some point later in life which is an indirect gift from my mother and this she knows I am doing. These are not pleasant conversations to have yet they have to happen and why the visit to the UK recently was rather tough.
The trust fund will be kick started next year once the Bull cycle is finished with the hope the investments I have do very well and can squirrel enough away to create a foundation being a starting point. I know if you give me 10 years and in this case possibly a little longer I can make a significant difference which would be more than enough for the grand kids to kick start their lives.