How to prepare for care home fees

While many people plan ahead for retirement, fewer consider their life beyond that. More specifically, what kind of care they may need towards the end of their life, and how it will be funded.

Care home fees can be expensive, costing upwards of £40,000 per year. In Scotland, care home fees are set by individual care homes and local authorities. The fees charged depend on various factors such as the level of care required, the size and quality of the room, and the location of the care home.

A person’s contribution towards care home fees is calculated based on their individual financial situation and their needs. Your local council will assess your financial situation, including your income, savings, and assets, to determine the amount you will be expected to contribute towards your care.

They may also take into account any benefits or grants you might be eligible for, such as Disability Living Allowance, which can help with the cost.

Capital limits

If you’re assessed as having sufficient income and assets – known as capital above the upper limit – you won’t get help from your local council with paying care home fees and will have to pay the full cost over and above any assessed entitlement to free personal and nursing care. If you have capital below the lower limit, you should be eligible for financial support from your local council.

Capital includes property, money held in bank or building society accounts, stocks and shares, National Savings Certificates, Premium Bonds, cash and land. From 11 April 2022 the capital limits are £18,500 for the lower limit and £29,750 for the upper limit.

If you have capital between the upper and lower limit, you’ll be assessed as though you have an extra £1 a week income for every £250 or part of £250 between the lower and upper limit.

Useful steps you can take

Assess your financial situation: This includes determining your income, savings, and any other assets you have. This information will help you understand the amount of money you may have to contribute towards care home fees.

Get advice from a financial adviser: A financial adviser can help you understand your options for paying for care home fees, including any benefits or grants that you may be eligible for.

Get advice from a solicitor: A solicitor can review the title to your property, your income and other assets to consider the best options available to provide asset protection to you in the event you have to go into care.

Research care homes: Research different care homes in your area and compare their fees, services, and facilities. Make a list of the care homes that meet your needs and budget.

Contact local authorities: Contact your local council for information on financial support for care home fees. They will be able to provide you with information on the options available to you and how to apply for support.

Plan for the future: Consider putting a plan in place to cover the cost of care home fees. This could include making a will, setting up a trust, or taking out an insurance policy.

It’s important to start preparing for care home fees well in advance and to seek advice.  McSherry Halliday’s expert solicitors and financial advisers can help you ensure that you have the right plan in place for your future.