The Problem

Funding Care without spending the inheritance.

The UK’s aging population means that by 2033, a tenth of people resident in the UK will be over 75. People in this demographic have tended to be home owners and therefore means that most will not be eligible for state assistance with long term care or care home fees. This trend is set to increase over the next two decades.

Indeed, a survey from June 2012 showed that then, 125,000 elderly care home residents were self-funded. This is because they had assets in excess of the £23,250 means-tested threshold which made them ineligible for any state assistance.

For most people, the family home is their main asset and, unless it is still required for a spouse or dependent relative, its value is included in the Local Authority’s Financial Assessment which assesses whether they will help with any care fees.

This being the case, most people find that they are not entitled to any Local Authority assistance with the fees, which currently average between £500 and £1200 per week. Unless you have significant income or other wealth, it may be necessary to use the value of the family home to help fund care.

Even the recent introduction of the government’s Deferred Payment Agreements, has done little to protect the value of the family home from being depleted by care costs. In effect this is a loan that is secured on the home to which a debt is added as the cost of care mounts up. The debt is recovered upon sale of the property or upon death which normally leads to the house being sold anyway.

However, it may be possible that with the right advice from qualified experts in care planning, sufficient measures are taken to try to protect your assets and your home from the cost of funding care. If you’d rather your family receives the inheritance that you want them to - the one that you worked hard all your life to provide them with - then there are a number of options that we can explain to you and hopefully build a plan together to protect yourselves, your loved ones and your assets.

We understand that this is a delicate and somewhat emotional decision for many, particularly if you are making these decisions for a loved one. Therefore, it is vitally important to take advice from experienced and fully qualified advisers such as us to help you make the right choices at the first attempt.