SJP Government & Local Authority support

When you are considering the type of care that you or your loved one needs, the costs can often seem like a daunting prospect.

It is essential to gather as much information as possible to understand whether you may be eligible for some help with funding your care.

Your St. James’s Place Partner can help you understand the steps that you are likely to need to go through.

support with carer

Will the Local Authority pay for some or all of my care?

The answer is that it depends on your individual circumstances. However, your local authority has an obligation at the very least to undertake a care assessment to establish what type of care you need.

In order to find out what you might be entitled to, you will need to undergo an assessment to establish the level and type of care that you require. Depending on the outcome of this, then a financial assessment will follow so that the local authority can decide how much, if any, of the cost of your care they will cover. For many people there is a good chance that they will need to pay at least some of their own care costs, if not all.

What does the assessment involve?

Your local authority will work with you to establish a ‘care and support plan’. The support will depend on if it is you that needs the care or if you are a carer on someone’s behalf.

The assessment will consider your care needs, what you can do yourself or what you will need help with. It will establish what type of care they think you need, how the care should be provided, whether the local authority will pay towards the care and, if so, how much.

If the local authority agree to pay towards your care, they will set up a payment plan for you, and agree the terms of how this is provided.

What is means testing?

Means testing is the financial assessment that the local authority will do once they have completed the initial assessment of the type of care you require.

They will look at your earnings, pensions, savings and investments, any benefits you might be receiving and also any property you have.

Typically, the local authority will help to pay for your care if your savings are less than £23,250 in England and Northern Ireland, £32,750 in Scotland or £50,000 in Wales, and do not qualify for NHS Continuing Healthcare. Generally, the more money you have, the more likely it is that you will be expected to pay more towards the cost of your care.

Do I have to sell my home to pay for care?

When it comes to paying for your care, a natural expectation for many people is that they may need to sell their house in order to generate the capital required.

As part of the financial assessment, if a spouse (or other eligible relative/dependent) will remain living in the property, or a paid carer is coming to your home, then the value of your property is excluded.

You may wish to use your property to help generate some income towards the costs of your care fees, for example renting out a room. Of course that can come with its own challenges, such as gaps in tenancy, and whether the income is enough to cover the amounts you require.

Alternatively, it could be possible to release equity from the value of your home. This is only really suitable for domiciliary care, and whilst you retain ownership of your home, this would necessitate using some form of lifetime mortgage, which would ultimately need to be repaid*.

Whilst selling your home certainly can’t be ruled out as a way to generate capital, there could be other solutions to consider if you have other assets.

A care fees plan for example, also known as an immediate needs annuity, can provide a guaranteed income that is paid directly to a care provider in exchange for a lump sum of money perhaps taken from existing capital or savings. You can also perhaps generate an income directly from any savings or investments you have to cover care fees.

If your property is your only asset, then the local authority should offer a Deferred Payment Agreement, which is essentially a loan to cover your care costs. It is a legal agreement that means you can defer repaying the loan until you choose to sell your house, or after your death.

Finding the most appropriate financial solution that meets your needs is where your St. James’s Place Partner comes in. They can advise you on the best approach for your circumstances, and guide you through each step of the process.

* To understand the features and risks associated with Lifetime Mortgages, please ask for a personalised illustration.

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SJP Approved 05/04/2024