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Ian Else

The Cost of Care

long term care, how to pay for long term care, top tips

It’s rare that the issue of care doesn’t come up during most annual planning meetings. Having gone through this with my own father recently, we thought an Ovation Insight into the do’s and don’ts of long-term care would be useful. 

 

Facts 

A girl born in 1841 was not expected to see her 43rd birthday, and it took until 1951, before a newborn male was expected to live past the state pension age of 65. That rapid increase has not slowed down, but not because we are more robust as human beings, but because of rapid advances in medical treatment. In short, we are all living longer, but generally in poorer health¹   

Often the burden for care falls on the family, and in some circumstances our relatives will need professional care.   

 

What are the costs?  

In the UK you can expect to pay £31,200 a year for residential care, rising to £43,732 if nursing care is required² , with the South West being the fourth most expensive in the UK.  

If you have capital, which includes savings and property of over £23,250 you will have to fund the cost of care personally until your capital falls below that figure. If you have a partner, elderly relative or child under 18 living with you, the value of your home isn’t included. We are often asked about giving away assets, but this is likely to fall fowl of the deliberate deprivation rules and should be approached with extreme caution.

 

What can you do 

Our first piece of advice would be to understand the rules around what you are entitled to, and what you are responsible for paying for. One example is the Attendance Allowance, if your elderly relative or loved one needs extra care in their own home you may be entitled to up to £85.60 a week.  

 

Severe Mental Impairment  

Until now we have looked at some of the more obvious aspects of long-term care, however the rules around severe mental impairment are less well known. Let’s start with that term, what does it mean?  

  1. The person has a sever impairment of social functioning and intelligence, which appears to be permanent  
  2. Has a certificate from their GP confirming the information in #1  
  3. Are entitled to certain benefits including the Attendance Allowance  

All three of these are often the case with anyone suffering from Dementia, which includes Alzheimer’s.  

TOP TIP! 

If they are assessed as having severe mental impairment they will be exempted from paying council tax. And in some circumstances nursing care can be fully funded, even if they have assets which means they fail the means testing.  

NHS continuing health care is funded by the NHS where the individual has been found to have a “primary health need”. The NHS have produced a video about the assessment for continuing care. However, if you have a family member or loved one who suffers from any form of Dementia it’s worth investigating.  

As always, we’re here if you, or anyone you know would like some Sound Advice on long-term care. 

Until next time…  

 

Ian Else – Financial Planner – Ovation Financial Management  

 

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