Funding for care homes

If you are considering moving yourself or a loved one into a care home, you need to be aware of the costs involved. Anyone who has savings of more than £23,250 (as of September 2020) and owns their own property (if moving into a care home) will have to self-fund, meaning the local council will not contribute towards the cost of care. If you’re not sure if this is you, you can take a free financial assessment, or means test.

Before making a final decision as to whether it’s time to move to a care home, your local council also offer a needs assessment to ascertain the level of care you might need – you can access this here. It will determine whether you can stay in your own home with occasional help, if you need adaptations making to your home, or whether moving to a care home is the best course of action. 

The cost of care varies, depending on the level required and where you live:

• a carer in your home can cost anywhere from £20 per hour to upwards of £600 a week if they live with you, and a lot more than that if you have greater needs; 
• a residential care home that provides meals and staff to help with everyday tasks starts from £700 a week 
• a nursing home offering round-the-clock nursing care starts from £900 a week.

Paying for a care home is costly. If you live alone and own your own home, you may have to sell it to pay your fees. If you live with a partner and they remain in the property, you do not have to sell.

Alternatively, it may not be possible to sell your home, or you may not wish to do so, in which case you will need to investigate other ways to access funds, such as:

• Equity release: there is a lot of money tied up in your bricks and mortar and if you’re over 55, you can release some of that. But beware it will require repayment on the eventual sale of the property, along with accrued interest on the sum released.
• Renting instead of selling: rather than selling your home, could you rent it out and use the rental income to pay your care home fees? This will require someone to manage the rental for you.
• Deferred payment: if your savings amount to less than £23,250 and you own property, the council may pay for your fees and you repay them once the property is sold. 

Always seek professional financial advice before entering into any financial arrangement. There are many independent financial advisers available and you can access free advice via Age UK and the Money Advice Service, both of whom are well-versed in assisting with care home fee payment options.