How to fund your own long-term care
You may be wondering how to fund your own long-term care, or you may be using Power of Attorney to fund care for a relative on their behalf. Either way, there are several possible options. (‘You’ below always refers to the person who will receive the care.)
- Releasing money from your home
You could downsize and move into a cheaper property, or rent out part or all of your home. Another way to free up money is with an equity release scheme, which will enable you to carry on living there. Alternatively you could set up a deferred payment agreement, in which your local authority will take payment at a later date from the proceeds of your house when it is sold.
- An immediate need care fee payment plan
Similar to an annuity, this gives you a guaranteed income for life, in exchange for a lump sum. This can be a good solution if you’re likely to need care for several years or more with little prospect of improvement, but may not be good value for those nearer the end of life.
- Other assets
Money from savings, investments and your pension pot could all be used to fund long term care. The difficult part is using these resources wisely so that they don’t run out too soon.
Creating the right funding strategy
How do you decide which of these options will work best for you? One of our specialist financial advisers can find you the most effective solution.