What caught my eye this week.
I found it hard to be outraged by last week’s decimation in the number of pensioners who’ll get winter fuel payments.
Restricting the annual cash award to those on means-tested benefits will see only about 1.5m pensioners getting the goodies in future.
The other 11.4m pensioners will just have to use their own money to pay their bills, like the rest of us.
Of course in many cases ‘their money’ will be, for you dear reader, ‘your money’
Monevator’s readership skews far wealthier than average, and it’s clear you’re aging out too.
So no doubt I’m biting the hand that feeds/reads me.
Nevertheless, downsizing winter fuel largesse will save the taxpayer £1.5bn much-needed pounds. A good call, as far as I’m concerned.
Low-to-middle earners have had it worse than pensioners for years, and a lot of the strain on the UK’s balance sheet is there because of national lockdowns that especially protected the elderly.
I’m not arguing here that it was wrong. Just that it’s right for the oldies to now share the burden.
If you feel differently then you could sign Age UK’s petition to reverse the decision.
However if you’re a wealthier pensioner who will really miss £200, maybe you could move to a smaller, warmer home instead?
Cheaper cosier homes
Rightmove came out with interesting figures this week. It flags a vast pool of housing equity that could be unlocked by empty-nesting OAPs rattling around in much bigger houses than they need.
The agent claims that swapping a five-bed home for a three-bed could release £500,000 on average:

Source: Rightmove
Besides a one-off cash tsunami, Rightmove also calculates that moving to a smaller, energy-efficient home could save more than £3,000 annually in utility bills.
The lost £200 winter fuel payment is small beans by comparison.
Unlocking this sort six-figure sum – tax-free – would solve most pensioners’ cost-of-living problems.
Though of course, most pensioners – even wealthy ones – don’t live in five-bed houses.
True, but the same principle holds up and down the ladder. Exchange hundreds to thousands of square feet you don’t need for an otherwise higher standard of living in a smaller property, with lower bills.
Few of these millionaire homeowners could have imagined the windfall gains they’d see from the UK’s relentless property boom when they first bought all those decades ago.
It doesn’t seem unreasonable to suggest more of them might tap into their good fortune to help ensure their own comfortable old age.
Down and not-out
It seems a no-brainer. Yet whenever you suggest asset-rich pensions should downsize if they need more money, there is indignation. (I look forward to reading the good natured variety in the comments below!)
Why should people be forced out of their family home? They may not need those bedrooms, but oh the memories!
That sort of thing.
Or – and I have more sympathy for this one – fine but where are we meant to downsize to?
The UK does have a shortage of high-quality, desirable homes for ‘aging in place’ as the Americans say. And what does exist seems very expensive.
Now that people are living so much longer and in many cases retiring so much richer – especially asset-rich – it’d be nice if property developers responded with bespoke communities of well-priced amenity-adjacent homes that suited ageing owners. Downsizing destinations that are just to good to refuse.
Add it to the list please, whoever is fixing the UK property market!
Oh, and for the record I don’t think anyone should be forced out of their home by government edict.
But equally, I would far rather my share as a taxpayer of that £200 winter fuel payment went towards an inner-city kid’s education instead – or an actually-poor pensioner’s living costs – than to fluff a weekend getaway for a pair of silver foxes living in a £1m-plus rectory.
If you can afford to heat a far bigger house than you need yourself, then fine.
But I don’t see why the state should help pay for it.
Fair enough
I accept there are interesting wider questions about how to juggle supporting or taxing the elderly versus giving the young a leg-up.
My feeling is life chances at birth are not even close to equal. That is mostly why I favour supporting younger people, as well as the better bang-for-the-buck the state will enjoy from their subsequently more productive working lives.
Together with the fact that the young are in the most trouble right now.
(I’m excluding here the several dozen kids with over £750,000 amassed in their Junior ISAs, as per a recent Freedom of Information request. Those lucky mites can fend for themselves too…)
Moreover by the time someone is 70, their life choices have usually contributed hugely to the state they find themselves in. Not exclusively – luck, good and bad, always loom large – but no, I also don’t have a lot of sympathy for someone who never worked much, or who earned well but frittered it all away.
This is exactly what irks many of us who save hard versus our peers, and yet end up being taxed to support the indolent as much as the unfortunate in their old age.
You earned it, you spend it
For many of you, the argument against higher inheritance taxes is similar. If someone did strive to improve their fortunes, why should they be stung extra hard for not frittering the money away?
Understood but personally, I would look to increase inheritance taxes if I was Rachel Reeves.
That’s because I maintain I’d be taxing (more heavily) the recipients of the inheritance who did nothing to earn it. Not the deceased who strived to earn and save it.
But I can see why blurred thinking around this distinction causes so much rancour.
Similarly, with the question of downsizing – or even paying for care home fees – a lot of the anger at the idea of going smaller in their old age isn’t because people actually need all that space to keep a lifetime’s clutter that nobody will want when their gone.
It’s because the should-be-downsizer and/or their children want to transfer that family home – a valuable asset remember – as tax-efficiently as possibly.
And again, ensuring genetically fortunate 50-year-old heirs stay as wealthy as possible isn’t my priority.
The bottom line is the state is cash-strapped, the young can’t afford even starter homes without parental support (where it’s available), we don’t build enough of the right properties for either the young or the old, and something has to give.
Don’t worry – I’m sure I’ll take my lumps too in the Budget come October. No doubt I’ll bemoan it too!
Have a great weekend.