Paying for Care
Before you start speaking to care providers it is helpful to have an understanding of what care usually costs and any financial assistance you may be entitled to. Citizens Advice should be also able to give you information – however family solicitors or financial advisors may not always know the answer to this question.
The cost of care homes can range from £800 to £2000 per week, depending on quality and location. At the higher end of this scale you would typically encounter high quality care homes which only accept self-funding clients, making them inaccessible to clients funded by the local authority.
Care At Home Costs
The cost of care at home usually works out at £20-£30 per hour and can be broken down into two parts:
- Personal care usually accounts for around 25% of care at home costs.
- Quality of life activities and tasks often form the bulk (up to 75%) of care at home costs. These include companionship, socialisation, attending appointments and household tasks. These are often the aspects of a person’s life that family and friends would take care of, but for someone who does not have loved ones to assist or living locally, or who may be suffering from dementia, they may need a lot of support in this area.
Residential Care Home Costs
The cost of care homes can be roughly broken down into three parts:
- “Hotel” costs account for about 70% of care home costs and include food, services etc.
- Personal care comprises around 20% of care home costs
- Nursing care accounts for around 10% of the overall care home costs
Given the substantial costs associated with good quality care, money can drive a wedge between family members and influence decisions.
It is a sad fact that money can cause friction between even the closest of relations, even when paying for care. Therefore to ensure stable and hassle free care in your later years, you should be pragmatic about the potential impact on familial relationships.
Different family members may have differing opinions on how a loved one should be cared for. Disagreements can occur if one family member feels they are shouldering more of the burden or responsibility, which can impact on them both emotionally and financially.
Seek out quality legal advice as early as possible to discuss how you wish to be cared for in your old age or in the event that you lose the legal capacity to make decisions for yourself. A power of attorney which clearly sets out how you wish to be cared for and who will bear the responsibility for implementing your wishes is essential.
You should also consider involving a trusted solicitor who would be able to intervene, in a neutral and emotionally detached way, should familial relations break down – ensuring that there will always be someone to act only in your best interests and according to your pre-agreed instructions.
The key thing to remember is that the elderly client’s wishes should be at the centre of all care arrangements.
In our view, the financial services industry has not yet fully understood or built products for the financial impact of care fees in later life.
There are some products on the market, like long-term care insurance policies, that guarantee a payout after a period of time and effectively limit the amount you would ever have to pay. As with all insurance policies however, getting them to actually pay out is not always straightforward.
Many older people never actually need care or support at all. Therefore you might not get value for money from a policy you paid into for 30 years and never claimed against.
Specialist financial advisers are now emerging onto the market offering personalised investment advice on paying for care in the future, which can be money well spent in the long run.