Arranging care for yourself or a loved one can not only be an emotional time, but also a very complicated one. There are a multitude of issues to consider, including mental capacity, eligibility for state benefits, Continuing Powers of Attorney, the type and location of care home and of course, funding the care itself. All of which require specialist knowledge. Yet the majority will fail to seek any sort of financial advice.
In the UK in 2012, there were 1.5 million people aged 85 and over, by 2081 this number is predicted to have risen to 7.8 million – this will account for over 8% of the total population*.
Statistics show that one in three of us will require care later in life* but we are expected to fund care ourselves if our personal capital exceeds £26,000. The average cost in a residential care home in Scotland is around £29,536 a year, rising to almost £38,324 in a nursing home and with the average stay at about four years, the costs are substantial*.
If you are in need of care and are a self-funder you will be concerned with ensuring that you are cared for in a home chosen by you and be confident that you will have enough money to pay the fees for as long as is needed. However, you may also wish to protect your wealth so that some inheritance may be passed on to the next generation.
There are different solutions available such as unit trusts, ISAs, investment bonds and also equity release**, for those whose home is their only asset and who wish be cared for in it. The only solution specifically designed for care is the Immediate Needs Annuity – a single premium is used to purchase the annuity which then guarantees to pay a certain level of care fees for the remainder of the person’s lifetime. The premium is determined on an individual basis given the medical conditions and family history and is underwritten by experts in this field.
Whether you are concerned about saving for care home fees in the future or facing the possibility of needing to pay these fees now, we, or a suitably qualified Long Term Care Partner of St. James's Place Wealth Management, can help you and your family with the options available.
For more information on the cost of care, click here.
The value of an investment with St. James's Place will be directly linked to the performance of the funds selected and may fall as well as rise. You may get back less than the amount invested.
Your home may be repossessed if you do not keep up repayments on your mortgage.
** This is a lifetime mortgage or home reversion plan. To understand the risks and associated features, please ask for a personalised illustration.
* Laing & Buisson Report 2013/14