Paying for care and planning for the future

The thought of paying for care later in life can be a daunting, but as the population ages and with retirement often lasting decades, how can we ensure we’re financially prepared? There’ a lot to take in when thinking about the cost of care fees. Funding your retirement can sometimes seem like an impossible task, but be assured there are a number of things you can do to minimise the financial impact. When approaching your local authority for financial assistance, the key to successful planning is to understand that only the income and capital of the person requiring care funding can be taken into account. For example, if a couple have £100,000 in a joint account, the local authority can treat this as the capital of the person requiring care, meaning £76,500 would be used for care. However, if the couple split the money into two separate accounts, only £50,000 could be considered, so only £26,500 would be available before the local authority had to contribute. Most people’ main concern is having to sell their home to pay for care. A common question is: “why don’t I give my house to my children now so the local authority cannot claim I own it in the future?” The answer is that deliberately depriving oneself of capital to avoid paying for social care is illegal. The local authority will ask why you got rid of your home (or other major asset) if not to avoid paying care home funding. Contrary to popular belief, there is no time limit on how long the local authority can look back, but the length of time since the gift will be a factor. Although some people are required to sell their homes, many people who feel they have no choice may actually be subject to one of many exceptions. Sharing a property with another relative over 60 or the renting out the house are two such possibilities. Before making the decision to sell the house you should consult with a solicitor, who will be able to explain the other options and disregards available. There are also various financial products available, which will pay for the cost of any care in return for an up-front payment. These products are not available or suitable for everyone and anyone considering them should take advice from a qualified professional before committing to anything. Your solicitor will also be able to advise you on any benefits and allowances that you may be entitled to, such as the NHS Nursing Contribution and Attendance Allowance. If your medical needs are the primary reason for your care requirement, it should be possible to get full state funding. Local authorities have traditionally been resistant to this approach and many people have had to resort to legal action in order to get the funding they are entitled to. If you feel you are encountering problems from your local authority you should contact your solicitor. Setfords Solicitors offers free consultations to anyone concerned about planning for the future. Contact us for more information.