Ben Harvey: I want my mum to die broke

I want my mum to die broke. By the time she goes to God, which likely won’t be any time soon because she is in rude good health for someone in her mid-70s (pretty good for someone in their mid-60s, to be honest), I want her to have spent every cent she has. Remember that film Brewster’s Millions? Where Richard Prior has to spend $30 million in 30 days? That’s what I want mum’s last years to be like. My father died young and didn’t get to enjoy the fruits of his hard work so I want mum to make up for it. When I say “die broke” I don’t mean “spending her last dollar on her last day” kind of broke; I mean “spending the last dollar on her last active credit card that’s not maxed out” kind of broke. Enron kind of broke. Lehman Brothers kind of broke. Kodak kind of broke. When we hold her funeral, I want creditors to outnumber mourners. Equity in the home? No chance. That’ll be taken care of by a couple of late-life reverse mortgages. If I inherit even one single buck I will be disappointed because it means it was a buck she didn’t spend ensuring her golden years, and then twilight years, were as fun, fulfilling and comfortable as possible. I realise I’m doing myself out of some dough by promoting this profligate behaviour but that’s fine by me (thought I am not sure whether my brother and sister share this position). The stats suggest not many boomers are being encouraged to die penniless. An astonishing $5 trillion is about to be bequeathed by people born during the 18 years which followed World War II. I’ll do it in numerals so you can see how many zeros we’re talking about: $5,000,000,000,000. Of the $5 trillion, about $2.3 trillion will go to the boomers’ kids, $1 trillion will go to grandchildren and $1.7 trillion to charities. A big portion of generations X and Y will be mortgage-free within weeks of probate being granted on their parents and grandparents. It’s a depressing way to retire the home loan and few will welcome the money because it will have come at the expense of more moments with a loved one. But Father Time is ensuring the inevitability of the greatest transfer of wealth in modern history. It will be about 10 years before the trickle of inter-generational generosity turns to a flood and in that period the boomers will become ever-more frail. By 2034 the oldest in the generation will be pushing 90 and only the youngest boomers, those born in the first four years of the 1960s, will be in any shape that might be considered spry. Most of them will require some form of aged care, either in their home or in a home. And this (finally) brings us to the point of this column and a message to this most vilified generation: don’t expect me to pay for your aged care if you have the money to pay it yourself. ENOUGH IS ENOUGH Australia’s very generous retirement system means I have had to subsidise your age pension for quite a while now (a couple with their own home can have more than $1 million in super and savings and still get part of pension, remember). I have subsidised your hospital care, either directly through taxes that pay for Medicare or increased private health premiums levied to offset the rocketing number of claims for joint replacements and stents. And I have subsidised your post-work social lives. Think of all those discounts you’ve enjoyed by flashing your seniors’ card over the past few years. Do think the business offering you 20 per cent off wears the loss? No chance. They charge the rest of us more to make up the margin. I am OK with all that because you, like my mum and dad, worked hard for your money and I want you to enjoy your retirement. I have made peace with the public policy absurdity of millionaires qualifying for social security because it’s politically dangerous to allow ordinary, law-abiding people like you to think there is nothing in the system for you. That opens the door for someone like Donald Trump to weaponise your discontent, promising to make retirement great again. But … I think I have done enough. You can pay for the final bit — the aged care part — yourself. The system is broke at the moment because it’s too cheap. We all know we need to spend more on aged care and we all know that can happen only two ways: higher taxes or higher charges for users of the system. My tax bill is high enough and so is your kids’. Believe me, they’d prefer a tax break now (when the mortgage payments and school fees are sapping their bank balances) than an inheritance later, when the wolf is no longer at the door. More importantly, they would prefer you really enjoy your life. They want these years to be more Golden Girls than Grumpy Old Men. Most importantly, they would prefer they didn’t have to worry about your well-being. I have friends who would strike a red line through a future inheritance in an instant if it meant making their parents’ lives more fulfilling, and their own lives less hectic, in the here and now. We all need you to dip into your pocket. So, if you have hundreds of thousands in the bank and need help around the house (that you bought for $27,000 and is now worth $1.8 million), don’t ask me to pay for your level-four home care package. That’s on you. If you are going into residential care and have fat stacks in a high-interest savings account, don’t expect me to pick up part of your daily accommodation payment. That’s on you. It has been my honour to subsidise your retirement. Don’t ask me to subsidise the inheritances of your kids.