When it comes to paying for care, if your savings exceed £23,250, it is likely that you will need to self-fund your care needs. The average cost of a residential care home is between £27,000 and £39,000 per annum, increasing to £35,000 - £55,000 per year if nursing care is required. While this may seem overwhelming, understanding the available options can help you make informed decisions about paying for care.

A major decision upon moving into residential care will be whether to retain or sell the family home. A Deferred Payment Agreement (DPA) can be helpful if you don't want to sell your home immediately. The local authority agrees to help pay care costs and recoups the cost of the 'loan' once the home is sold. Renting out your property can also generate an income to help pay for care fees. This can be a standalone option or used alongside a DPA. Equity release is a highly flexible option allowing funds to be raised against the value of your home to pay for care at home.

If selling the family home, then decisions need to be made around what to do with the proceeds in order to fund care. Are they simply left in cash savings and drawn down upon? Are they invested for potentially higher longer term returns? Another option is an Immediate Needs Annuity which is specifically designed to cover the costs of care, usually to cover the difference between care fees and your existing income. In exchange for a lump sum payment, an Immediate Needs Annuity will provide a regular income to cover care fees for the remainder of your life. It is likely that a combination of all three might be optimal once we have explored your individual circumstances and wider family priorities.

So many options and navigating the complexities of paying for care can be challenging at an already stressful time. Engaging with a SOLLA Accredited independent financial adviser can help you to make a bespoke strategy for your long-term care planning, ensuring you have peace of mind that you will be comfortable and free from worry about care costs.

To discuss your circumstances with us, please call 0117 3636 212 or email office@haroldstephens.co.uk. Our office is located at 50 High Street, Westbury on Trym BS9 3DZ.