How will you fund your future care needs?
of people
use some form of social care
in last year
of life
30%
don’t think
or speak
about care
82%
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deplete their assets when funding care
24%
of people thought care services were free
30%
Assessing the cost of long-term care
Q&A
Funding care in later life can be costly.
Long-term care needs are different from one person to the next. Some people may not be able to live at home any longer, and some may need specialist medical care. Costs for this can vary greatly. Are you aware how much this may be and have you made any provision for it?
You’re not alone if you are confused about how you might meet your care needs. Here are some of the common questions that people have relating to care.
Won’t the state pay? Only in certain circumstances
Will I be eligible for Local Authority support? It depends on your circumstances
Am I alone in not having planned for this? No
State benefits
It’s important to claim everything you are eligible for, don’t end up paying more than you need to.
Attendance Allowance (over 65s).
You could get £55.65 or £83.10 a week depending on the level of care required.
Personal Independence Payment (under 65).
For long-term health conditions or disability. You could get between £22 and £141.10 a week.
Paying from income
Using your pension to fund care costs, although this is unlikely to cover the full costs of your care.
Paying from savings / investments
Cashing in your savings or investments may make up the shortfall, but you run the risk of running out of money.
Purchasing an insurance product
A care plan where you pay a lump sum to an insurer who pays out a guaranteed income for life to help meet the costs of your care.
Relying on a 3rd party top up
e.g. payments from family or friends.
Sell your property and go into a care home permanently
- Potential anxiety caused by emotional attachment to your home.
- You may want to retain the property as a family inheritance.
Downsizing
Moving to a smaller house to release equity in your home.
Equity Release
Using some of the equity tied up in your home to pay for care.
DPA (Deferred Payment Agreements)
If eligible this arrangement with your local authority would allow you to use the equity in your home to help pay care costs.
Renting out your property
Consider tax, insurance and other fees when working out potential income from this source.
Are care costs the same throughout the UK?
No. Residential care home costs vary in all parts of the UK. It depends on regional location.
average costs per week
How much does it cost?
When the local authority are considering funded care for you, they will assess your care needs and the cost of meeting them – this is known as the ‘local authority rate’. They will also undertake a financial assessment (means test) to see how much you have in the bank, including the value of other assets.
What is a local authority care needs assessment and how does it work?
If your needs do not match the financial criteria, don’t worry, there are other sources you may be able to turn to.
£563
£511
£546
£578
£573
£673
£741
£702
£655
£566
£639
£516
£666
£776
£755
£725
£837
£986
£949
£1041
£927
£769
£852
£670
Residential care home
on average per annum
£31,200
Care home with nursing
on average per annum
£43,732
England
Wales
Scotland
Northern Ireland
Capital
£0 - £14,250
Capital
£14,250 - £23,250
Capital
£23,250+
If your income and savings are above these limits it’s still worth worth contacting your local authority – you have the right to a care needs assessment, regardless of your financial situation.
The illustration below, based on English thresholds highlights the care costs you will be responsible for if you have assets less than the capital limits.
If your capital is between these amounts you will have to pay towards your care. For every full or part £250 over the lower limit you’ll have to pay £1 per week
They will assess how much the individual
is unable to do and gauge the level of support required.
If you have less than £14,250 in capital, your local authority will pay
£23,250
£30,000
£26,500
£23,250
Capital Limits
Care and support needs
A ‘care needs assessment’ will be carried out by the local authority if you require help with everyday tasks.
Contact the Social Services Department of your local authority to find out if you’re eligible. If you have savings and assets totalling more than the amount shown in the table below, you may have to fund your own care:
You will have to pay full cost of your accommodation and personal care
For example
£19,250 capital is £5,000 over the lower limit
For every full or part £250 over £14,250 you contribute £1 per week
Which means you pay £20 per week to your care
The outcome of the financial assessment
agree to meet the full cost of your care
agree to meet some of the cost (and you’ll need to top up the rest)
leave you to meet the full cost of your care.
Ways of funding care
The outcome of the financial assessment will be that the local authority will:
Then the authority will decide if you've met their criteria, if so, a care and support plan will be drawn up.
There are several ways in which you can arrange paying for care:
Ways of using your property to fund care:
North East
North West
Yorkshire and the Humber
East Midlands
West Midlands
East of England
London
South East
South West
Wales
Scotland
Northern Ireland
Request a ‘care needs assessment’ from the local authority, if they are not already aware of your situation
The assessment is carried out by a social worker, or other trained professional, usually at your home.
A ‘means test’ will be conducted to assess if all costs can be met by the authority, partly or none at all.