Paying for Care – relieving the stress
Paying for care is a mystifying issue at an emotional and stressful time. The endless form filling, complex state benefit system and uncertainty over the future continues to cause untold strain on thousands of families each year.
Many factors are involved in decisions over paying for care but the first priority should always be to get a health assessment from the local authority, known as a Section 47 Assessment. There is an obligation on the local authority social services department to perform an assessment of a person’s care needs. The assessor should discuss the person’s circumstances with the family and offer the option of a family member or friend being present at the assessment.
If the local authority agree that care is needed then a financial assessment will be carried out to determine any state contribution. Due to current funding pressures, many people are only provided a contribution when assessed as having ‘critical’ or ‘substantial’ needs. This significantly restricts the number of people receiving care paid for by the local authority. At this stage, a problematic issue arises – meeting the cost.
The cost of care
It’s important to plan ahead for funding care because it can be expensive. Currently, a residential home costs over approximately £26,000 a year on average.
If nursing is required, that figure can easily increase to over £36,000 a year1. Just two hours of daily assistance in your own home could amount to more than £12,826 a year.
Financial eligibility means-testing is highly restricted, only those with assets worth less than £14,250* (including property) can get all of their care funded. Above £14,250*, individuals are expected to make a contribution, while anyone with assets of £23,250* or more is expected to pay for their care in full.
Currently, 40% of people who are in residential care are paying for it themselves3. It can be tempting simply to try to pay for care out of savings and pension income. But given the high costs, savings could quickly be wiped out. It is advisable to consider other solutions that can generate income indefinitely without the risk of running out of capital.
If care has to be funded privately, then seeking independent financial advice from a specialist financial planner is highly recommended. Be sure that the person appointed is qualified, but equally important to that is your comfort in their approach. You should feel comfortable that they are considering your best interests – don’t be ‘sold’ to. Being sure that an adviser is taking the time to fully understand your individual circumstances as a family is fundamental. This is when an adviser relationship can really take the confusion and uncertainty out of a very stressful situation.
1,3 Laing and Buisson – Care of Elderly People – UK Market Survey 2010
2 Laing and Buisson – Domiciliary Care – UK Market Report 2011
* In England and N. Ireland 2012/13; different limits apply in Scotland and Wales.
About the author
Global Care Specialists offers a bespoke service to clients and their families who are facing the prospect of looking for and entering into the care system, whether it is requiring care at home, or placement in a care home, providing a wide remit of services beyond long term care incorporating all aspects of later life planning.
For more information see www.globalcareuk.com
For a no obligation discussion about planning for care or arrange a free consultation, please call 01403 780780 or email firstname.lastname@example.org
Global Care Specialists is a trading style of Global Financial Limited which is an appointed representative of Best Practice IFA Group Limited which is authorised and regulated by the Financial Services Authority.
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