Reduce care home fees and long term care costs

Many of my clients are terrified at the potential cost of their care fees in old age. They fear they’ll have to lose the family home as well as any other savings, and consequently reduce the amount they can leave to their loved ones, in order to raise the funds needed to see them through to the end of their days.

They are right to be terrified. At 2015 figures, the average cost of a care home is over three times higher than the average annual mortgage payment – £30,628 for ordinary residential care and a staggering £35,048 for nursing care per person per year – and rising.

If the average length of stay in a care home is four years, that’s between £122,512 and £140,019 off the eventual value of your estate.  In plain terms, that’s £122,512-£140,019 less to pass to your family and friends.  And research shows that care fees rise more quickly than the retail prices index (RPI) to which some pensions are linked.

Those who aren’t terrified of the cost of funding long-term care are often under the misapprehension that care is free in Scotland. While personal care and nursing care are free (for now), the residential component of the cost of care is not covered. Unfortunately, accommodation is usually the largest bill of the three – and the cost has increased by 69% since 2002 (when the Scottish legislation providing free personal care was introduced) with no guarantee that it will not continue to rise.

For many seniors, the only way to pay for care is to sell the family home or have money loaned to them against its value.  There is no getting around it: if you do not take action now, the cost of your care will significantly reduce what is left of your estate to pass to your beneficiaries.

It is entirely possible to protect yourself and your family against rising care costs and I firmly believe that it is wise to do so. I work with expert partners to offer a variety of packages that ‘ring-fence’ your future long-term care funding and protect your home and estate.

This firm complies with the ISPW Code of Practice.