Funding your care

02 September 2010

The prospect of moving into residential care or even having carers in your home can be daunting and is certainly sometimes a difficult change to deal with.

The local authority should provide an assessment of your needs so that the most appropriate type of care may be arranged for you. The local authority will also assess your ability to pay for the care and you may therefore need to contribute towards some or all of the care costs, depending on your situation.

If you find yourself in the position of needing to fund your own care from your income and capital assets, seeking advice on the best way of achieving this will ensure that you are aware of all the options and can make the most suitable choice for you.

State Benefits

The first thing to do is make sure that you are claiming all the benefits to which you are entitled. In particular, Attendance Allowance for those over the age of 65 should be considered as this is non means tested and paid free of tax.

Welfare benefits continually change. There is a clear need to seek advice to ensure that you are claiming the right benefits. We do have a dedicated welfare benefits adviser at Furley Page who will be able to assist.

Investments

Your existing savings and investments should be reviewed to check that they remain suitable for your needs. There are a number of points to consider including the type of returns they are providing (e.g. income or capital growth), how risky they are and their taxation.

Where you have funds to invest, for example from the sale of a property, you should obtain independent advice from an adviser who is suitably qualified. There are many considerations to take into account when making investment decisions and there is no single appropriate strategy that suits everybody. By taking advice, you can be sure that the investments provided are suitable for your specific needs and circumstances and that these will be reviewed regularly by your adviser.

Immediate Needs Annuities

If your income is not sufficient to meet your care home costs, you may need to invest to provide additional income. In some cases, it will be easy to generate sufficient income to comfortably meet your immediate and future care costs from investments. However in some cases it may be more appropriate to provide a guaranteed income for life from the purchase of an annuity with a lump sum.

Your Property

You may need to sell your home in order to fund residential care home costs or you may apply to the local authority for deferred payment scheme in order that you can keep your house until you choose to sell it. It may be appropriate for you to rent out your property, providing you with a regular income as well as the capital value.

Another option available, particularly if you are keen to stay in your home for as long as possible, is to release some equity from the property. Caution is needed when considering equity release schemes as there are various types and they can have significant implications depending on the type of plan chosen.

Equity Release schemes are not suitable for everyone, however can really make a difference to some, particularly where staying at home and maintaining a quality of life is the overriding priority. It is necessary to take advice from both a suitably qualified equity release adviser as well as a solicitor before proceeding with these plans.

For further information contact Ruth Dolan on 01227 763939.

Download Everyday Law Summer 2010

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