Care home fees are increasing at a staggering rate and this is not likely to change over the coming years. The rate at which they are increasing is higher than the rate at which pensioners incomes are rising. Care home fee planning is vital and with more people living longer, more people are needing to cover the costs themselves.
On average, most people stay in a residential home for around two and a half years which means that the fees during that time can amount to around £80,000. In order to cover this cost, most of us will need to sell a property which can be upsetting to those who have worked hard to leave something behind for their children.
A positive to take from this is that not as many elderly people are ending their days in a home, with the figure sitting somewhere around 10%. However, it’s natural to not want to hand over your hard-earned money to others. It is important that plans are put in place in good time, particularly if you want to make sure that you protect your assets so they can be passed down to your family.
When it comes to care home planning there are generally two differing views. Those who choose to use their money to make sure they have the best quality of life and those who have strong feelings about family inheritance and are willing to leave their fate to the state system.
Of course, there is a vast difference in residential care homes and that covers the standards and the resources that staff have available to them. The price can vary and more often than not, the lower end of the scale tends not to be a place where someone would want to see out their days.
So, with the costs continuing to rise, it’s important that people put three things in place. These are wealth management, lasting powers of attorney and asset protection. This will help you to prepare for a time when you might need to go into a care home.
There is a myth whereby people believe that if they give away all of their money, they can avoid paying care home fees but this is not the truth. It’s common for local authorities to trawl through your affairs to see if you have done anything to try and avoid paying the bills. If this is the case then funding could be refused.
There are instances where people do this without seeking advice and then their children spend their money quickly. Therefore, by the time they need residential care, there are no finances available as they are then considered to have deprived themselves of their assets intentionally as a way of avoiding paying the steep care home fees.
Everyone has a different view on life and death and that can cause people to take a different approach when it comes to making the right decisions. However, if you want to ensure that you still have a choice when it comes to residential care then you might want to consider trusts and Will trusts at a time when you are able to.