Funding care

With care costs spiralling, Yours money editor Sarah Jagger explains what the rules are, what you may be entitled to and how to protect yourself and your loved ones

‘It’s not possible to pre-insure against long-term care... so save for a contingency fund’

How much am I likely to need?

Residential care homes can cost anything from £200 to £1,500 a week. Even if you go down the care-at-home route, you’ll find that at around £17 an hour, two hours of daily care could amount to £12,500 a year.

Will my family have to pay for my care?

The situation is different depending on where you live and how you came to need care. Costs are also split into care costs and accommodation costs. Normally the first 12 weeks of care and accommodation are free. After this, your assets are taken into account – including your home, unless a partner or dependant lives there. In England and Northern Ireland the figure is £23,250, Scotland £26,500 and Wales £30,000. Some people give away assets to avoid paying for care but be aware the local authority could still make you pay under the Deliberate Deprivation of Assets rules. Before you make any decisions, seek advice from an independent financial adviser (www.unbiased.co.uk).

What help is available?

It’s not possible to pre-insure against long-term care, so it makes sense to save for a contingency fund and invest using ISAs and pensions to be able to help meet costs. Even if you have to pay for care you may still be entitled to claim benefits such as Attendance Allowance (people over 65) and Personal Independence Payment (for people age 16-64, replacing Disability Living Allowance) if your health needs are great enough. You may also be able to claim a Council Tax discount.

Visit www.Turn2us.org.uk to see what’s available to you

The only bespoke financial product available is an immediate-care annuity sold by companies including Just and Aviva. This provides high levels of income based on your life expectancy. They can be good value if you live longer than expected as they reduce the impact of care costs on your estate.