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Funding Care Fees

Unless your parent is eligible for funding help from the Local Authority, you will need to look carefully at how best to manage meeting the regular care fee bills – especially if you want to preserve some of your parents’ estate to pass on to the next generation.

Paying for Care Fees yourselves without support from the Local Authority, does have its benefits. It does, for example, widen your choices in terms of the care you purchase.   However, maintaining sufficient funds to continue to pay your fees for an indefinite period does require careful planning.

As a “self-funder”, your parent 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

How much will we need?

According to Which? (Nov 2016/17), the average cost of residential care in the East of England in 2014-15 was £600 per week.

  • If nursing care is required, the average cost goes up to £841 per week.
  • A new full state pension currently brings in just £159.55 per week. Anyone who retired before April 2016 will get a maximum of £119.30 plus any additional entitlements they’ve accrued.
  • You may be entitled to other benefits and allowances, click HERE for more information.

Where can I get advice?

 A financial adviser who is authorised and regulated by the Financial Conduct Authority is your best source of advice. There are 2 specialist accreditations that advisers may hold that demonstrate their knowledge and experience of dealing with Care Fees and other later life issues.  These are:

These accreditations show not just specialist knowledge, but also evidence that the adviser understands the need to safeguard vulnerable people and deals with clients with empathy and patience.

You can also visit our Self Funded Care  section which will give you further advice on equity release, annuities and deferred payment agreements.