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Self funding your care

The austerity measures of recent years have had a significant impact on adult social care budgets and the reality is that a high proportion of people are now having to self fund their own care. As a result many local authorities have had to raise the “needs bar” for when someone qualifies for funding via social services.

Simply put, if your capital, savings and or income puts you outside the upper means-test thresholds for local authority funding, you will generally be responsible for paying your own care. However, there are some scenarios where the NHS may be responsible for funding (see our article on NHS Continuing Healthcare Funding or CHC Funding, as it is known.) and there are some occasions when your property, as well as certain types of investments, cannot be included in the means test.

However, with careful planning it may be possible to structure things in such a way that care fees can be paid for the rest of your life – without the worry that the money might run out, while also leaving other investments untouched.

The first step is to think about what your ideal care would be, and then talk to a specialist financial advisor who will  discuss all the conceivable options, exploring both the health and financial implications of each, and often creating a previously unthought of solution. Expert financial planning helps ease the burden of worrying about your finances at a time that might be both highly confusing and emotionally draining. As everyone approaches the funding of care fees differently, and everyone will have different financial circumstances,  personal, tailored planning with a professional adviser is vital. It is important not to dismiss any care options until such advice has been taken.

 There are often ways of affording care that searching the internet or talking to friends and even health professionals wouldn’t necessarily reveal.

Such expert planners should be authorised and regulated by the Financial Conduct Authority and should have obtained a dedicated long-term care qualification. For added reassurance, they should also be Disclosure and Barring Service (DBS) checked (previously CRB), and therefore cleared to guide vulnerable people.

The advisor will hold a face-to-face meeting to assess the situation thoroughly from both a care and a financial perspective.  After thorough research, they will present the person in care and/or their legal representatives with a comprehensive report detailing each and every available option, together with their recommendations. This allows the client, legal representatives and/or the family members to weigh up all the facts and make an informed decision.

Depending on individual circumstances, the report could include the opportunity to purchase an ‘immediate care plan’: a dedicated and potentially tax-free product designed to cover all or part of the care fees.

This type of specialist financing can be funded from existing savings and/or ‘equity release’, where capital is unlocked from a property, or other alternatives. There are of course pros and cons to all these options, so they do need discussion with suitably qualified advisors. Once established, immediate care plans can pay towards care fees indefinitely.

As a matter of routine, the specialist advisor will also give guidance on practicalities such as first checking whether there are state benefits that can be claimed. Not all of these are means tested or taxed, such as the Attendance Allowance,  which is available to anyone aged over 65, who has needed care with essential daily tasks for longer than six months. The equivalent for younger adults is Personal Independence Payments (formerly known as Disability Living Allowance).

For more information on self funding your care to live at home, give us a call, we’d be happy to help.