Exciting end to the year when I am in the studio on Eddie Nestor’s Drivetime show on BBC Radio London 94.9 FM to talk about pensions. Most talk is about drug smuggler Akmal Shaikh’s execution in China so my contribution is reduced, but for an enlightening counter to the “how awful!” chorus, see http://www.dailymail.co.uk/debate/article-1239051/LEO-McKINSTRY-Sorry-join-liberal-wailing-heroin-traffickers-deserve-die.html
If you’re surprised by the Chinese reaction, go to Google and search with “opium wars”. My favourite book here is the classic Foreign Mud by Maurice Collis http://books.google.com/books?id=DK78eANlr-AC&dq=foreign+mud+collis&printsec=frontcover&source=bl&ots=vBNcl-5RI&sig=GecSuwuzNtGh7KhlT3JWFQhkZxw&hl=en&ei=TsZBS-GZBI6i0gTJ-tGSBQ&sa=X&oi=bookresult&ct=result&resnum=1&ved=0CAgQ6AEwAA#v=onepage&q=&f=false
Another highlight is a relaxing day spent with friends in the beautiful village of Ickwell, home of clockmaker Thomas Tompion. Two surprises there. Firstly, after-dinner whisky is Welsh http://www.welsh-whisky.co.uk/ and very drinkable too while the village is one of few in England with a permanent May pole http://www.bedfordshire.gov.uk/CommunityAndLiving/ArchivesAndRecordOffice/CommunityArchives/Ickwell/ThomasTompion.aspx
Christmas Day itself finds me at church after some years. A daughter’s parents-in-law are over from Italy and Dad wants to go to church. Choice is between the Italian Church in Clerkenwell Road http://www.italianchurch.org.uk/ and St George’s, Hanover Square http://www.stgeorgeshanoversquare.org/ As friend www.georgemetcalfe.com is reading the epistle at the latter, it is St George’s where apart from being a beautiful church, the choir is stunning and worthy of another visit. Three daughters and their two grandsons make the family gathering everything such an event should be. Eldest grandson is now a toddler who finds the sofa, grandad’s paunch and other seated members a useful climbing frame. In true child tradition and for part of the time, the clear packaging that fits nicely over his and grandad’s head, is more appealing than the contents. Youngest grandson now three months old, smiles when you talk to him and has a look of bewilderment when strange sounds come out of his mouth. Hunger is indicated when he slobbers over and sucks hard on the end of my nose – time to hand him back to mum.
But let’s get serious. Final business meeting of 2009 is with Partnership Assurance attending a workshop on how to develop long-term care business – something which is now more topical after the monumental indifference I found in the 1990s. Being twelve years older and the credit crunch have sharpened people’s minds, it seems.
Most readers will be able-bodied and capable of washing, dressing, feeding themselves etc. When you start to need help with these, start to forget what day it is or dare I say it? can’t recognise members of your own family, you need what is commonly called long-term care. We all like our independence and no likes to be a burden, but this can change overnight perhaps with a fall, hence the title. A lively debate always follows when this subject comes up with “Someone else should pay!” at one end and people who can afford to take a better off view at the other. If care has to be paid for and you haven’t got insurance, you have six choices:
i) Cash – use your own money. Nice if you have it, but even if you do, do you wish to burn it all up living in a home?
ii) Get the Local Authority to pay for it (What everyone wants) There are also Deferred arrangements with a few councils (live now, pay later). Here they pay for care now but take a charge on an elderly person’s home and only get repaid when the person concerned has died or their home has been sold. Councils cannot charge interest in this situation so few allow this option, and you can’t blame them.
iii) Rearrange your portfolio to produce income. Needs to be a big portfolio if the yield is say, 5 per cent p.a.
iv) Equity Release to get a lump-sum or income. Realistic BUT being based on annuity rates (which in turn are based on life expectancy and interest rates) these are low currently. Even five years ago when interest rates were much higher, the rates were not great, even at age 70. Falling house prices has led to an exodus of providers here.
v) Buy an Annuity. Often the only option but many people leave it for too long and there is not enough cash or equity left when they finally do get round to looking at it. The cost of care can be capped. The insurance company that provides the annuity income takes on the risk of the person concerned living a long time. The risk of someone dying say 2 months after buying one can be insured separately.
vi) Renting out your own property. Fine in theory but do you really want this? Beneficiaries might not be happy either. Rent you get from renting out your own home is unlikely to be enough to pay for care in a residential home.
Seventh option might be to give one’s career to care for a parent for example, but this can be the most expensive.
People with no money will probably get their care paid for by the local council while few have enough to pay for everything. Most common situation is a shortfall in the cost of care which planning for now will make it easier to cope with, and perhaps safeguarding someone’s inheritance.
There are other issues too and equity release for example, will involve a solicitor. The following might be worth a visit as well http://www.georgeemsden.co.uk/2009/10/your-worst-nightmare/