Do You Have to Sell Your House to Pay for Care in the UK?
It’s no secret that accessing care support can be expensive. As the cost of living rises, it can be hard to find ways to ensure that your loved one can receive the best care possible without placing financial strain on yourself or your family. You may be tempted to take drastic steps to secure the funds needed.
Read on to find out about the types of financial support available, so that you can make an informed decision, or find alternative solutions that can still provide you with the high-level care deserved.
Do you really have to sell your house to pay for care?
In some cases, people may choose to sell their house, or the house of their loved one in order to contribute to the cost of care. Sometimes this can be a practical solution: if your loved one is struggling to live at home, or if your family is looking to downsize, then selling a house is a quick and easy way to access the funds your family needs.
However, It’s important to remember there is support out there that means you can still receive exceptional care without having to sell your house to afford it.
How can you pay for care without selling your home?
There are several ways to manage the costs of care, so that your family can receive the support they deserve. From government schemes to NHS funding, find out more about the options available to you below.
Equity release
Equity release is a popular option for older homeowners in the UK looking to fund long-term care costs. This option allows individuals to unlock the value of their home by taking out a loan against its value, without the need to sell or move.
Typically available to those aged 55 and over, equity release plans, such as lifetime mortgages or home reversion schemes, provide a tax-free lump sum or regular payments. The loan, along with interest, is repaid when the property is sold, usually after the homeowner moves into permanent care or passes away. Equity release can help cover care expenses while allowing individuals to retain ownership of their home. However, it’s essential to seek independent financial advice, as it can impact inheritance and long-term financial planning.
NHS care funding
The NHS offers a variety of funding options that could help your family to access care. Continuing Healthcare (CHC) is available to support individuals with severe or complex health needs, and is often used after an individual has returned home following a hospital stay. This funding package is ongoing, and can provide funds to help your loved one access continuous care and support. The NHS also offers Funded Nursing Care (FNC) for individuals who require care but don’t qualify for CHC. In this scenario, the NHS allocates a set amount of funds to cover the care provided by a registered nurse. This funding also helps to cover the cost of specialist services, such as medication administration or wound care.
These programmes can provide a much-needed care resource to your family. However, access to this care does require meeting strict eligibility criteria, which includes identifying a primary health need, an initial screening and a healthcare professional assessment. These are designed not only to discover if you’re eligible for NHS care, but also to determine the level of need, so this can be a slow and lengthy process.
Attendance allowance
Attendance allowance is a government benefit that provides financial support to people aged 65 and over who are living with a long-term illness or disability. In order to be eligible for the allowance, you will need not only to have reached state pension age: you must also need help or supervision for a minimum of six months. The standard rate for attendance allowance is £72.65, but if you have a terminal illness you may be eligible for a higher rate.
The allowance can help the individual to cover the cost of the assistance they need with daily activities, such as eating, washing and getting around. As it is non-means tested, your eligibility for attendance allowance is not impacted by your income or savings. Rather, it is split into two rates depending on the level of care needed: lower rate care for those who need help either during the day or the night, or higher rate care for those who require both. One of the main benefits to attendance allowance is that it can be used for flexibility, so if your family needs change the care can adapt to suit your individual circumstances.
Care fee annuity
A care fee annuity (sometimes called an immediate needs annuity) can also be used to provide financial support so that your loved one can access the care they require. Usually purchased from an insurance company, the fee involves paying a one-off lump sum. After which, regular income is paid directly to the care provider. A care fee annuity does guarantee that the care fees will be met, but does also come with its own risks: the capital on the annuity could be lost if your family member doesn’t need care for as long as the insurance company predicts. However, many consider this potential loss of capital as a worthwhile risk, as they prefer the peace of mind the care fee annuity offers.
Investments and savings
If you have investments and savings, you can use them to pay for your family’s care. In many cases, people save money so that they will be supported in later life, so if your family does have financial reserves these can be a quick and immediate solution. It’s possible that your family member may have allocated funds for such an occasion that you are not aware of, so if possible speak to your family about their savings and any potential care funds. Some people also consider investing savings and using any potential returns to fund the cost of care. It is important, however, to be aware that investments come with a high level of risk, so should not be made without first consulting a financial advisor.
Deferred payment agreements
Deferred Payment Agreements (DPAs) allow those who do not want to immediately sell their home to defer care costs. In this scenario, the local authority will cover the cost of care as a loan on the person’s house. If you or your family member enter into a DPA, you will repay the local authority the cost of the care fees once your house is sold. DPAs can be used if you have a carer who needs to continue living at home with you or your family member, then you are still eligible for the DPA. Choosing live-in care over residential care means that your family can defer the cost of care through a DPA, allowing your loved one to stay in the comfort of their own home.
Government funding
You may be eligible to access government funding that can provide you with financial support so that you can afford care for your loved one. Government funding is means tested, so if your savings or assets are under £23,250 the government will cover the cost of care. Assets considered by the government include bank accounts, investments and savings, ISAs, stocks and shares, dividends and secondary properties. The value of your home is also considered an asset if it exceeds £23,250.
How can you cut the cost of care?
It is possible to cut the cost of care, without sacrificing the quality that your family deserves. Live-in care is a more affordable alternative than residential care, allowing your family to continue their life uninterrupted, with access to the support and services they need. Live-in care is considered a more affordable option for a variety of reasons, but perhaps the most impactful is that your loved one can stay in the comfort of their own home, receiving one-to-one, personalised care without the need to pay accommodation fees.
At Ashridge Home Care, we build a care plan tailored to your family member, so that you’re only paying for the services they need.
Why choose Ashridge Home Care for care at home?
At Ashridge Home Care, we work tirelessly to provide our clients with dedicated, high-quality care that meets their needs. With expertly trained carers monitored by the Care Quality Commission (CQC), you can have peace of mind that your family member is receiving exceptional care by a team of diligent and regulated carers. We’ve been rated Outstanding in Caring by the Care Quality Commission (CQC) and are passionate about providing a personal, tailored service.
When you choose Ashridge, you’ll get access to a dedicated care manager, who will help to individualise your loved one’s care plan, so that their physical, mental and emotional needs are met. Whether you’re looking for occasional support through hourly care, or round the clock live-in care, our team can build a care plan that works.
Looking for high-quality care that can give you the chance to focus on spending time with your family? Ashridge Home Care can take the weight off your shoulders, so that you enjoy making more treasured memories with your loved ones. Contact us today to find out more about our care options.