Planning for pay for care in later life

21 November 2019

Many people are unaware of the costs involved in later-life care and are leaving their financial planning to the last minute.



Deborah Stone is a leading expert in the field of elder care and the author of The Essential Family Guide to Caring for Older People. Exclusively for Saga, Deborah explains what you should be thinking about in terms of later-life care…

Decide what type of care you might want

The first step is to think what your ideal care scenario would be, then talk to a specialist ‘later life’ financial advisor (not just a standard financial advisor). They’ll assess each situation thoroughly and advise on all conceivable options, including whether any state funding is available. It is sensible to talk to a financial advisor who specialises in later life planning.

It’s important not to discount any options until expert ‘later life’ planning advice has been taken, because there are many ways and means of shaping and affording care. Specialist later life financial planners will be authorised and regulated by the Financial Conduct Authority and will also have obtained a dedicated long-term care qualification. They will be Disclosure and Barring Service checked too to provide added reassurance that they are cleared for guidance involving vulnerable people.

Caring for elderly relative

How are care fees determined?

Fees will be determined by many factors. For example, if you are considering getting care at home, costs will depend on whether you choose to manage the carer(s) yourself, including their tax and national insurance, or whether you wish a care provider to do this for you, in which case they will charge an additional fee. The type of care will determine the cost as well.  Companion care, for example, will cost less than specialist personal care for people with more complex needs or challenging behaviours.

A specialist later life financial adviser can recommend ways to set up an immediate care plan, which is a dedicated and potentially tax-free product designed to cover all or part of a person’s care fees for as long as it’s needed. Once established, immediate care plans will pay towards care fees indefinitely, so they can provide you with peace of mind and as such, are a popular choice.  Another alternative is to borrow cash against your home from banks, building societies, or via some of the specialist mortgage products available to fund live-in care.  The annual interest, which is currently relatively low, is usually settled monthly.  The original mortgage capital debt can often be settled from the proceeds of the house with no additional interest to be paid.

These schemes should not be confused with equity release, which has definite pros and cons.  You can also consider downsizing, to release money from a larger house and to move to somewhere more manageable.

Essential tips for carers

How can a specialist later life planning adviser help me?

A specialist later life planning advisor will hold a face-to-face meeting to assess the situation thoroughly from both a care and financial perspective; then prepare a comprehensive report detailing every available option together with their recommendations. This allows the client, legal representatives or family members to weigh up all the facts and make a truly informed decision.

Expert care fee planning also helps ease the burden of worrying about essential monetary matters during a time that is often highly confusing and emotionally draining.

Not everything is means tested or taxed, for example. Attendance Allowance is available to anyone over 65 who need assistance with essential daily tasks for longer than six months.

There are some scenarios where the NHS may be responsible for funding. If full time care is required and a person’s primary need is a health need, all their care fees could be paid by the NHS through NHS Continuing Health Care, although this is difficult to obtain. 

What you need to know about care home fees

Don’t leave it too late to plan how you pay for care

Families often reach crisis point with an older relative, at which point they have no time to research the options properly, so planning ahead as early as possible is vital.

The Essential Family Guide to Caring for Older People by Deborah Stone is published by Green Tree (an imprint of Bloomsbury). The book is the first, and ultimate source of information and help for families to make informed choices about their relatives (and later, their own) care. Buy it now at a discount from the Saga Bookshop.

The Essential Family Guide to Caring for Older People by Deborah Stone



The opinions expressed are those of the author and are not held by Saga unless specifically stated.

The material is for general information only and does not constitute investment, tax, legal, medical or other form of advice. You should not rely on this information to make (or refrain from making) any decisions. Always obtain independent, professional advice for your own particular situation.