The UK population is ageing, as people live longer than ever before. This month, Rosie Dixey discusses the importance of considering care home fees when planning for your future…
Care homes have never been far from the headlines during the Covid crisis, as many families struggled to see ageing or infirm relatives due to the restrictions.
No one wants their elderly loved ones put into nursing homes, but the reality is, as our needs increase, we may require help looking after ourselves. However, residential care is not cheap – the average fees are between £700 and £900 per week.
If I need to move into a care home, will I have to pay my own fees?
Your local authority will carry out a means-tested financial assessment to determine whether you will have to pay for residential care or you are eligible for funding.
If you have income, savings and investments, etc. of more than £23,250, you will be required to meet the full cost of your own care.
If your assets fall below this threshold, you will receive partial or full funding from the council and there are mechanisms in place to help those who need extra assistance.
My wife and I own our home outright, will this be included in the care fees assessment?
Try not to worry, your spouse will not have to sell up and leave the family home if you are taken into care.
You must have a beneficial interest in a property for it to be considered when care home fees are being assessed. This means, if it was sold, you would be entitled to a proportion of the proceeds.
Your share of the property will be included in the means tested financial assessment, unless the house is partially or entirely occupied by one of the following at the time you go into permanent care:
1. Your spouse, partner, former partner or civil partner
2. A relative who is over the age of 60 or a child under 18
3. A lone parent who is your estranged or divorced partner
4. Someone who is incapacitated
If there is anyone living with you who fulfils these criteria, your home will be protected, until they move out. If the property is sold, your share of the proceeds will then be taken into consideration against care home fees.
If my house is included in the means-tested assessment, will it have to be sold?
As I mentioned earlier, if your share of the property exceeds £23,250, you will be required to meet your own care costs. However, if you don’t have the funds in cash, the local authority can offer you a Deferred Payment Agreement (DPA). This means you will not have to pay any of your fees until you have passed away or your property is sold.
As a DPA is a long-term loan, the agreement will be subject to administrative fees and interest on the money you are effectively borrowing from the council. You will usually be allowed approximately 70-80% of the value of your property, to ensure the money can be repaid when the time comes.
With a DPA in place, you can sell your home when you feel ready, or even rent it out to create an income to pay for your care.
To find out more about planning for care home fees, why not book a free 30-minute consultation with one of our probate specialists? Telephone (0114) 218 4000, email: info@tayloremmet.co.uk or complete this form.
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