If your parents or relatives need more care at home or to move to a care home, the first questions are likely to be “how much?” and “who pays?”, as well as the third, unanswerable question “how long for?”
The cost of care rose by 40% in Dorset last year (source: www.trustedcare.com (September 2016) ) and it was the 10th most expensive county in England with weekly fees in a care home averaging £799 and nursing home fees of £967 per week.
Unless they are eligible for help from the Local Authority (currently this means having savings/assets of less than £23,500 2017/18 in England), they, and you will need to work out how best to manage the regular care bills – especially if your parents want to preserve some of their estate to pass on to the next generations.
Paying for care costs and fees without support from the Local Authority does have some silver lining….it does, for example, widen the choices in terms of the care you purchase. However, maintaining sufficient funds to continue to pay care fees for an indefinite period does require careful planning. As “self-funders”, your parents could potentially use a range of sources to cover care fees. These might include:
- Pension savings, taken either as an income or as a lump sum withdrawal
- Income from savings and investments
- An Immediate Care Plan which is an annuity product specially designed to provide a top-up to income to meet care fees
- Borrowing such as Equity Release and Lifetime Mortgages, although this option is only usually available for care in your own home
- Rental income from a property
Where can I get advice?
Poundbury Wealth Management LLP offers expert financial advice in investment planning, pensions, inheritance tax planning and long term care planning. Contact us at www.poundburywealth.co.uk or call 01305 266866.
Partner Tim Gallego is a member of The Society of Later Life Advisers (SOLLA), a not for profit organisation set up to meet the need of consumers, advisers and those who provide financial products and services to the later life market.
The Partner Practice represents only St. James’s Place Wealth Management plc (which is authorised and regulated by the Financial Conduct Authority) for the purpose of advising solely on the Group’s wealth management products and services, more details of which are set out on the Group’s website www.sjp.co.uk/products. The ‘St. James’s Place Partnership’ and the titles ‘Partner’ and ‘Partner Practice’ are marketing terms used to describe St. James’s Place representatives.