Will your inheritance be lost to Care Fees or can it be avoided?
Most of us work hard for the majority of our lives and when our time comes, we hope to leave an inheritance for our children or our families.
But…what about Care Home fees? What if we have no other option but to go into a Care Home, it may not be necessary for all of us, but a large proportion of us will have to because of our care requirements.
So, who pays for the care?
In the UK, those over the age of 65s make in excess of 1.3million requests each year for care and support.
A recent report (following a Freedom of Information Act Request) found that, across 205 Local Authorities:
- 31% of over 65’s in Care received fully funded care; and
- 53% of over 65’s in Care received partially funded care.
When broken down into regions, the report found:
Percent of Over 65s receiving fully funded care
You will see there is great disparity in the number of individuals that receive funding across the regions. So, is it a postcode lottery?
With Local Authorities only providing fully funded care in 31% of cases across Great Britain, what does that mean for the rest?
The eligibility criteria, for care funding, in Great Britain differ for England & Northern Ireland to Scotland and Wales. Here we will concentrate on England & Northern Ireland (if you require information for Scotland or Wales, please do get in touch).
To assess an individual’s eligibility for care funding the Local Authority will carry out a means-tested assessment and consider the income and capital of the individual applying for the funding.
The means-tested assessment will differ depending on whether the care required is to take place in the individual’s own home or whether the individual needs to move into a Care Home.
Where the individual is able to stay in their own home, with care and support, then the value of the individual’s property will not be included within the capital valuation.
Where the individual needs to move in to a Care Home, the value of the individual’s property will be included within the valuation. Where this property is still required for a surviving spouse to live in then this may be excluded from the valuation.
Now, for the finances:
- You will have to fully fund YOUR OWN care fees if…
- your capital means are assessed above £23,250; or
- if your capital is under £23,250 but you have a weekly income that is high enough to cover the cost of your care
- You will have to partially fund YOUR OWN care fees if…
- your capital means are assessed between £14,250 and £23,250; or
You will pay £1 towards your care for every £250 of savings that you have between £14,250 and £23,250
- You MAY receive funding for care fees if…
- Your capital means are assessed at less that £14,250
BUT…you may have to contribute from your income. However, you must be left with at least £24.90 per week (Personal Expenses Allowance for 2019/20) although the Local Authority may consider increasing this allowance if there are specific property-related expenses that the individual is responsible for or if the individual is also supporting a spouse.
Your property value may be ignored for a period of 12-weeks, when you first move into care, for the purpose of the means-tested assessment but following this period, it will be taken into account (as per the above).
So, does this mean that your property will need to be sold, in order to pay for care costs?
Not always, BUT…
Where you do have to fund your own care costs, the Local Authority may agree to a Deferred Payment Agreement (rather than sale of the property straight away) and this will mean that the care costs will be paid to the Local Authority when the house is sold or when the individual dies, meaning that the property can remain in the family, but will have a charge over it in favour of the Local Authority.
So, where does that leave you?
The same report considered above, found that just 21% of those over the age of 55 had made any provision for their future care costs and 44% said that they would use their savings and investments, with 40% thinking that their pension would be enough to cover the costs.
If you would like to consider your options and what can be done to give you peace of mind and avoid the loss of your Estate, and ultimately your family’s inheritance, get in touch!
In this article we have not considered NHS Continuing Healthcare Funding and if you require more information on this then please do get in touch with Leah Waller who has extensive experience in applications and appeals in relation to NHS Continuing Healthcare Funding. Keep your eyes peeled for future articles in relation to this.
If you are concerned about yourself or a loved one moving into care, or want to get some plans in place, get in touch for a FREE chat on info@TotalLegacyCare.co.uk or 01727 865 121
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