If you live in England or Northern Ireland and your personal assets are more than £23,250 you now have to pay the cost of the long term care you will receive.
Apart from the emotional cost, arranging care for yourself or a loved one is also extremely complicated. Dealing with issues like mental capacity, eligibility for state benefits, Lasting or Enduring Powers of Attorney*, the type and location of the care home and funding the care itself causes stress and worry.
And yet only one in ten people entering care will have sought any financial advice**.
In 2015, 1.5 million people living in the UK over 85 (2.3% of population) – expected to rise to increase more than 5 times to 7.7 million in 2086 (8.7% of population).***
The 'single' average cost in a residential care home is around £29,250 a year, increasing to over £39,300 for those receiving nursing care, and with the average stay at about three years, the costs are substantial***.
If you are in need of care, and have to fund the fees yourself, 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.
For those whose home is their only asset and who wish to be cared for in it, there are different solutions available such as unit trusts, ISAs, investment bonds and also equity release****. The only solution specifically designed for care is the Immediate Needs Annuity - a single premium is used to purchase an 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 purchaser's medical condition 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, 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.
Your home may be repossessed if you do not keep up repayments on your mortgage.
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.
* Powers of Attorney involve the referral to a service which is separate
and distinct to those offered by St. James's Place and are not regulated by
the Financial Conduct Authority.
**** This is a lifetime mortgage or home reversion plan. To understand the risks and associated features, please ask for a personalised illustration.
** Oliver Wyman for Partnership, 2010
*** Laing & Buisson Report 2014/15