The idea of saving money to pay for you or a relative’s stay in a care home is a very unpleasant one, but it’s something that we will all most likely have to face up to someday. Care homes offer practical support and quality care, which most families are simply unable to provide and offer represent the best option for us all. With this in mind, it’s important to start saving for care home fees, so you can be as prepared as possible for this eventuality.
Earlier this year, the government announced that it is putting in place a new loan scheme which means people across England (Wales, Scotland and Northern Ireland have different regulations), won’t have to sell their homes to fund their stay in a care home.
Currently, certain councils provide interest-free loans at their own discretion, but from 2015 this will be available to all those seeking loans across the country, however, the loans will now also charge interest.
Councils are obliged to pay for care if the assets that you own are valued at under £23,260, but, if you own your own home, then it’s unlikely to qualify for this. It is also no longer worth attempting to give away all of your assets to demonstrate this as councils can now purse for you ‘deliberate deprivation’ and are able to withhold payment of care fees until you have spent the amount you gave away on care.
Here are some tips to sure you’re financially prepared for the cost of care home fees:
Start Saving Early
As soon as you’re able to start putting money aside, you should. Care home stays cost, on average, £30,000 per year, so you’ll most likely need to save up for quite a few years.
Diversify Your Saving Methods
Investor Chronicle recommends that you look at a range of savings options and a variety of tax-efficient accounts. Investing like this will act as a barrier against any potential inflation in the future and keeps providing you with new income.
Look At Life Insurance Options
If you think that taking out a council loan is the best option for you, then why not invest in life insurance to counter balance this. That way, the loan can be taken care of as soon as the payout comes in.
