Should my 52 year old sister in law contribute to bills/ pay rent so my father in law can stay in his house longer?

If your father in law is still competent, a conversation needs to be had with HIM about finances. As a veteran, he may want to investigate Aid and Attendance benefits to help pay for his costs of living. If the carrying costs of the home are too much, he needs to think about downsizing.

I understand why his arrangement with your sister in law irks you (and possibly his other children), but unless you are all pitching in on his bills, it really is his decision to have her live there rent free. Until he can't make his own decisions, I think it's not appropriate for the siblings to decide how he should be making ends meet. The sister who does his bills should sit down and show him the math and help him explore some options for dealing with the problem.

His children should talk to him frankly about his current burn rate and ask how they can help him going forward.

Reading more in your answers below: SIL should contribute *something.*

I suppose she has contributed something, in a way, even if she is no domestic goddess - she's been your father's constant companion for the whole of his eighties, and I am seeing every day how loneliness is older people's most profound and intractable problem. She's saved him that, at least. She's "been there." It's not nothing.

But as things are now, it's not enough. Your husband needs to discuss your father's care plan with her and cover all of the subject headings - what kind of care, what options there are, and funding.

The girl's not stupid: she can see she either shares costs now, or she finds somewhere else to live (which won't be free, or have her lovely Dad in it). All she needs is for the conversation to be started, sympathetically, but talking actual numbers.

By the look of it, Rent free Gal has a good thing going.

But maybe she is an amazing caring daughter doing all the housework, cooking & cleaning & that's the deal between Father-Daughter. This would be their business. Maybe their are cultural or age expectations that she stays if still single?

Or maybe she is an entitled free-loader who will go beserk if Father has to sell house to move into care? "But that's MY house!" These types are out there...

Time will tell.

Maybe the place to start is listen to what Father wants for his future care & what he can afford. Having a professional third-party involved (non-family) may be of huge benefit with strong personalites to deal with.

I'd probably zip my mouth rather than open up a family warring match with in-laws.

But no, I would not be paying for the care. He needs the care - he pays. That's life I'm afraid.

Just staying in the house, checking that Dad is okay and keeping an eye on Dad is providing a care giving service. It continues to absolutely astonish me how many people come to this forum discounting the value of that service and wanting relatives to "pay" for the privilege of being responsible for another human being. I seriously doubt your FIL would have been able to remain in his home alone into his late 80s without help. Your SIL's new SUV purchase is not related to any care giving issues or FIL's finances; probably only your envy meter. It's very convenient to see SIL as a potential cash cow now that FIL needs to spend his savings on care givers. Since SIL has been "contributing" to FIL's care for years, perhaps other family members need to step up now?

If FIL moves to AL _then_ SIL should start paying rent and other household expenses or move out so the home can be sold.

Since she works two jobs I don't see how FIL is bankrolling her. Ok, she lives rent free...but she is there daily, and that is a service. She may not be doing hands on care giving , she couldn't if she was working full time but by having her live there she is in fact caring for FIL.

Here's the thing. She is THERE.
Could he go on living there without her? If not, then she is quite invaluable just for being there. I understand that your Dad wants to stay at home, but at this point, have you EXPLAINED to adult daughter that Dad will have to go into care in 6 months, and likely the home sold to PAY for that care? That may be what you are looking at.
Or you may be looking at Dad going into care --period. Whether it is what he "likes". That is, unless he has the money for 24 hour care, which is something that few of us have. I would get together with Sister and discuss where things are at financially, what the choices will be in the near future, and honestly not a discussion for Dad to be in, because he will have his "wants" and then there is realistically what can be afforded, what can be done. Just you, hubby and SIL.
This is honestly the choice of your husband. You BOTH know what you are looking at down the line and I have to assume you have made your feelings and your observations clear to him, as you did to us.
At some point, if he wishes not to address this, you might do well to step back and let it be. I did this just last week and it is why the IKEA cabinets in the new tenant's kitchen is looking kinda wonky to me at this point. Honestly, at some point, when you do not have the power, when it is all argument, it is best to step away and sing a few stanzas of "Let it be, let it be, let it be, let it be; seeking words of wisdom, let it be".
Wishing you the very best of luck!

I think some of this depends on what the understanding was when she moved in as compared to what it has become.  Did she move in to help him out financially (or as a caregiver)?  Or, did he let her move in because she had nowhere to go?  Sometimes it's both situations at the same time.    And things could have changed over the 8 years which have gone by.  In either case, she won't be able to live with him rent free anymore if he can't afford to stay in the house.   On some level, I'm sure she knows this.  But please spell it out for her and make sure she understands.  I've seen families destroyed by a "sudden" decision to sell a property which really should have been obvious - particularly to the person living there who does not own it.

I am guessing even if your DH asks her, she wont pay.   DH needs to talk to his dad about long term plans, assisted living, whatever.   Many of the best places will want some private pay time before Medicaid.

Does your husband feel he needs to ask his sister? If he feels like that, then there probably should be a "family meeting", just the direct family, siblings...
All significant others, and In-Laws should step back, take a breather. Let the family deal with this one.

You never know... Ms RentFreeFunGal may decide herself (after a family meeting) to start paying rent? She maybe a carefree spirit that just doesn't think much about boring things... like other people's bills.

Fate will deliver the life lesson *shelter is not free* at some stage.