Planning for your Future Care
It is never too soon to think about planning for your own or a loved one’s care. As the population ages, one in four of us will require support in old age. We look at the ways you can plan practically and financially to ensure you have a more comfortable and stress free future.
Have ‘the difficult chat’
Avoiding difficult conversations might seem easier at the time, but the unfinished business and complications that can come in their place can often be much worse than facing up to the difficult reality at the time. Concerns, values, spiritual beliefs or views about what makes life worth living are important issues to consider when developing a care plan. Not having these conversations can leave u
psetting memories or regrets for loved ones once the person has mentally departed, is severely ill, or has died.
Get an Isa (Individual Savings Account)
It can be tempting to avoid until the last minute – but the reality is that the long term costs of elderly and disabled care can really add up, so planning for this can save a lot of stress in the future. Pensions and savings will meet some bills, but advisers warn most people will face a funding shortfall when it comes to paying for their care. Putting aside the pennies for the future in an Isa can be a backup to your pension and other savings and it can grow free from capital gains and income tax. This money can be invaluable considering yearly care costs can vary in cost from around £11,000 per year for part time home care and £37,500 for full time care home if nursing is required.
Find a proxy
Decide who your parents (or you) will appoint as the health care proxy. This will be the person who makes the decisions in case you or your loved one can no longer communicate effectively. Appointing a single proxy is a very important decision. This person needs to be able to make decisions based on understanding and empathy – they must understand what is happening with assets and finances and should respect the values and beliefs of the person being cared for. Select someone who will be able to carry out the person’s wishes even if they include denying life-sustaining treatments. You or your loved one may inadvertently put your family through agony by avoiding this important subject.
Unlock the value of your home
Owning a property is a valuable asset – especially in the more lucrative rental regions of the country, such as London. Even if you are still currently living in your home, you might be able to rent out a room and save this money towards potential future care. If you are not currently living in your home, renting the property itself out can often pay a huge chunk of care costs.
Get a Local Authority Assessment
Local authorities must work with people in their areas to provide or arrange services relating to care. This should include identifying the local resources already available and helping people to access them. If you think you need care now, or in the very near future, the best way to plan your care is to ask your local authority for an assessment.
Understand the Care Act 2014
Understanding how the Care Act 2014 affects you might be complex and time consuming in the short term, but it can potentially save you thousands in the long term. The Care Act 2014 creates new provisions that will come into force from April 2020. It will introduce a ‘cap on care costs’ that will offer you protection from the risk of losing everything you have to meet your care costs. It does this by setting a maximum amount that you will have to pay towards your eligible care needs. Once you reach the cap, your local authority will take over meeting the cost. Currently, if you have more than £23,250 in assets, such as your home or savings, you will need to meet the full cost of your care. From April 2020 this will increase so that more people benefit from financial help.
For more information you can contact your local Citizens Advice bureau or see the NHS page on planning for your future care needs.