Avoiding Care Home Fees
Avoiding care home fees might seem like an attractive option, especially if you would like to avoid the possibility of losing assets such as your home in order to pay for your care in later years. However, taking steps in avoiding care home fees now may serve to hinder rather than help you later.
If you are lucky enough to have the financial means, personal contributions towards care home fees can also give you greater control over which home you live in and the level of care that you receive.
Avoiding care home fees: LA assessment when you move into care
When you move into long term care you will be financially assessed by your local authority, and if you own assets above a certain threshold you will have to pay for some or all of your care home fees. The upper threshold is between £22,000-£23,000 depending of where you live in the UK, if you have assets above this level you will be required to pay all of your care home fees. If you are suspected of giving away any assets at any time before the assessment for the specific purpose of avoiding care home fees, these will be counted by the LA towards your assets anyway, or be recuperated from whoever you transferred them too.
Protecting the assets that matter most to you
It is understandable that none of us want to see the assets we may have spent a lifetime building disappear into care home fees to provide for our final years. Even though it may not be advisable to try avoiding care home fees there may be ways that you can protect the assets that matter most.
- Relatives occupying property. If you have a civil partner or spouse living in your property, a relative who receives incapacity benefit, or who is aged over sixty or under sixteen, your property will not count towards you assets for the purposes of means testing.
- Keeping your savings separate. Keeping any savings that you and you partner have separate will mean that those savings will be protected from care home fee costs when you assets are taken into consideration. This can give you peace of mind knowing that your partners assets are protected.
- Tenants in common. If you share a home with a partner or spouse it is likely that you own the property as joint tenants. This means that if your partner dies their half of the property becomes yours. However, by becoming tenants in common instead of joint tenants when your partner dies they can bequeath their half of the property to someone else and protect it from care home fee costs, by putting it into a trust or handing it over to a child for example. This means that although you may remain living in your property for life, if you need to move into a care home only one half of the property will be assessed as belonging to you.
While avoiding care home fees may not be possible, putting your finances in order to prepare for later years and to get the most out of you assets is an important step to take. You may wish to speak to an independent financial advisor for advice on dealing with your finances, winding down you assets and preparing for retirement.
For advice on financial planning for long term care needs and to discuss options that may be available to you speak to a member of a long term care planning advice team, for independent, impartial advice and a fee free consultation.
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