Care funding plans

What are care funding plans?

It’s a financial product that provides an income for life – to help you avoid running out of money to fund your care in the future. Care plans are bought with a lump sum, and are non-refundable. The income is normally paid direct to your registered care provider – if paid in this way it will benefit from favourable tax treatment.

Is this different to an annuity?

It’s a type of annuity. It’s sometimes referred to as an immediate needs annuity.

Why would I want to buy a care funding plan?

A care funding plan may be suitable for you if you’re already in a care home, you’re about to move into one, or you’re receiving care at home – and you want to be sure that there’s a regular income that’s guaranteed to pay towards the cost of your care for the remainder of your life.

Where can I find out more about care funding plans?

We always recommend that you talk to a financial adviser about your situation, before making a decision. They will be able to give you more information about the care funding options available to you. Your local authority can help you find an adviser in your area, or you can find impartial details of advisers on thepfs.org or unbiased.co.uk websites.

How much do care funding plans cost?

The amount you’ll need to contribute will depend on your own personal circumstances – for example, how much income you’d like to secure, your age, the state of your health and your life expectancy.