By Brian Herd, Partner at CRH Law, our Lead Legal Professionals at Heather Hill Pathways.
For all those baby boomers embarking on a long and sustained period of well-deserved and well-saved for later life pleasure (also known as ‘retiring’ ‘withdrawing’, ‘going away’, ‘leaving’ or ‘retreating’), – stop – think again – your parents need you!
Bernie and Bernice had only recently retired. Being newly hatched retirees, they were champing at the bit to take off and explore those 1001 things they had always wanted to do. Bernie had 3 siblings spread all over the world. Bernice had no siblings and had lost her parents many years ago.
Bernie’s surviving parent, his father Cyril, was 83 and Bernie was also his Enduring Power of Attorney. Having just come out of hospital and in fragile health, the writing was on the wall – Cyril needed high care in a residential aged care facility. Along with his other siblings, Bernie thought that Cyril’s move to aged care would be good for Cyril. It would also loosen the shackles of having to ‘be around’ and enable Bernie and Bernice to fire up that new winnebago and explore this large brown land.
Cyril was a full age pensioner with not a lot in assets except for his now very valuable old Queenslander in a lovely leafy inner city suburb of Brisbane. Figures of over $1.5million were bandied about as the market value of the home.
Being the dutiful son, Bernie had found the perfect aged care facility only some 10 minutes away from his and Bernice’s home. Trouble was they wanted Cyril to pay some $450,000 by way of an upfront refundable accommodation deposit (RAD). Cyril didn’t have that sort of money but he did own that very valuable piece of property.
Bernie and his siblings didn’t often see eye to eye but, on one issue, for once, they were determined and agreed – they didn’t want that home sold in order to meet the RAD payment. Besides, keeping it in his dad’s name would have certain benefits for Cyril as well (so Bernie’s research told him).
That winnebago was baying for action. Bernice had set her heart on adventure and that didn’t involve tending to the physical and financial needs of her frail father-in-law. They had assiduously saved all their lives for this moment but now, enter Cyril, stage left, to squash those dreams.
As usual, they briefly regretted that they had not confronted Cyril’s situation earlier and at least planned for it. They were now in crisis mode and had to do something about Cyril right now as the facility told him they needed a decision immediately and if not, they would have to offer the place to someone else.
Bernie was desperate. Cyril had about $100,000 in cash but where was the balance of the RAD of $350,000 to come from? While there were other options, given that time was pressing and the opportunity could be lost, Bernie decided he would provide the $350,000 for Cyril and he would have to raid his superannuation to do that.
Bernice was none too pleased – that money was their running away money and now they would be tied down to both a financial and a ‘being around’ commitment for Cyril and, by the way, where were Bernie’s siblings to lend a hand!
By the time Bernie and Bernice got to see me, the money had been paid and Cyril had moved in to the facility. Bernie and Cyril were relatively happy. Bernice, on the other hand, wasn’t really talking to either of them.
Bernie, Bernie, Bernie were some of my first words to him as he and Bernice slid into their hot seats in our interview room. Did you know that:
Bernie’s complexion turned white and Bernice’s red – they found it difficult to look at each other – awkward.
Without boring you with the next exciting instalment in the Cyril saga, needless to say, Bernie had to expend some more hard earned retirement savings on me and my very reasonable fees. Bernice, I understand, may have also sought some separate family law advice on her situation.
The impact of the aged care needs of our ageing parents is like a multi headed hydra – it can permeate every aspect of our lives and our families. It can even affect relationships between previously long and happily married children.
Best to stop there, me thinks, assuming the message of this article is clear – get some advice before you take the plunge for your parents.