Paying for Care

If on the otherhand, you fail to qualify for NHS Continuing Care and need care in a care home, the responsibility for providing your care rests with the local authority and they are compelled to do a financial means test to see if you need to pay for your own care.

Paying for your own care

If you need to be self funding, there are a variety of ways in which care fees can be met, the main ones being:

A Deferred Payments Scheme:

If your total assessable capital (including property) exceed the upper capital threshold £23,250 England, £23,500 Scotland, £22,500 Wales (2011/12), providing your other (non-property) assets are less than £23,250 England, £14,500 Scotland, £22,500 Wales (2011/12), rather being forced into selling your property immediately, you can apply to your local authority to pay the care costs for you until either you decide to sell it or die. In return you allow the Local Authority to place a legal charge on your property to ensure they can recover the money owed once the property is sold. If your application is accepted your Local Authority are only obliged to allow you “defer” the difference between your income and the maximum published contractual rate your local authority is willing to pay for the type of care you need. If you choose a more expensive home, then your family would still be liable to pay any difference.

Purchasing A Care Fees Annuity:

In return for paying a one off single premium to a specialist long term care insurance company, an immediate care fees annuity allows you to transfer the worry of paying for an unknown period of care to the insurance company who guarantees to provide the insured regular income "annuity" indefinitely to your care provider to meet your care fees. This can help you cap the cost of care at the outset and protect any remaining money for future personal use or inheritances. To ensure as much money as possible is left, we normally suggest that they are set up to provide only the shortfall between your care fees and ongoing income.

Due to way such annuities; provide very valuable tax-free income; ensure care fees can be met indefinitely; limit the eventual cost of care and thereby helps ensure not all of your of your savings will be used to fund care, it is not surprising these relatively little known method of funding care are quickly becoming the preferred funding method for many, especially all the time alternative deposit rates offer so little.

To find out just how little one of these annuities might cost request a FREE personalised quote today, click care fees annuity

To consider the advantages and disadvantages of a care fee annuities click here.

Investing to provide income: This approach normally involves selling any property and investing the proceeds, in an attempt to provide the required income to meet the shortfall. Depending on your attitude to risk this can either be by depositing the money in deposit accounts or by investing the money in a diversified portfolio of different assets in an attempt to provide a higher return. Whilst this method might preserve the largest amount of money, should you die early, neither way provides any guarantee that the money will continue to meet increasing care fees fees and will require regular changes if you want to try and maintain the best rates or obtain the best returns.

Renting any property to provide income: Instead of having to sell your property to pay for care, should your shortfall be quite small, you might prefer to rent it out and use the income to pay for your care fees. However, for many the gulf between cost of care and income is simply too big for potential rental income to bridge. This coupled with the fact that renting also means you have to assume the responsibility of being a landlord regularly maintaining the property and having no certainty that TAXABLE income will continue uninterrupted, means for many this is simply not a realistic option.

Which is the best method of paying for care?

Which method is right and leaves you with the most money will depend on many factors including; life expectancy; the cost of an annuity; how much money you have and your attitude to risk. This is where professional care fees advice becomes invaluable as as not only will we be able to check your eligibility for state funding but once we have obtained all care fee annuity quotes, we will be able to analyse them and compare them with all other funding options for you.

Clearly, should your assessable capital exceed the applicable upper capital threshold figures and, you have to pay for your own care, it would pay to seek professional care fees advice and look at how much care fee annuities would cost.

To request your FREE care fees annuity quote or to request a call back from a specialist care fees adviser so that you can talk through your options, click here.