For many people, all they initially need is some help around the home. This is often referred to as domiciliary care.

Nevertheless, care at home can be very expensive and once you include ordinary household bills it can be even more expensive than receiving care in a care home.

So how can you pay for care at home?

First request a Care Needs Assessment is carried out

Once you realise you need some help, you should always contact your Local Authority – Adult Social Care Team to ask for Care Needs Assessment. This will assess what your care needs are and whether they are complex, and health related or due to disability.

If your needs are complex or health related, you may even qualify for totally free NHS Continuing Healthcare.

Everyone is entitled to ask for an assessment – regardless of savings, and it doesn’t cost anything.

If you don’t ask for one you will definitely have to pay for your own care.

If your needs are not primarily medical or due to disability, the responsibility for your care passes to your Local Authority.

They will need to draw up a care plan and subsequently carry out a financial assessment to see if they need to pay for your care at home or whether you will need to be self-funder.

When assessing your finances, as you will remain living in your home, they should exclude the value of your main home.

If your other savings and investments (including any second property), exceeds more than currently £23,250 in England or £24,000 in Wales (if need domiciliary care ) or £50,000 (if need care in a care home) or £36,750 in Scotland (2026/7) you are likely to have to pay for your own home help.

Even if your savings are less than £23,250 England or £24,000 in Wales (if need domiciliary care ) or £50,000 (if need care in a care home) or £36,750 in Scotland (2026/7) you may still need to pay for your own care if your income (including any State Benefits exceeds a certain minimum amount.

If it does, they will expect you to make a contribution towards any care at home they agree is appropriate.

If you live in Scotland, providing your Social Works Department agrees you need care at home, they will provide Personal Care free of charge regardless of age, although you will still need to pay for non-personal care such as;- cleaning, day care, laundry, meals on wheels etc. yourself.

Alternative ways to Pay for Care.

If you don’t qualify for any Local Authority funding, or simply want more hours of care, what other options are there to pay for care at home?

Using Income

The most obvious is to use your income and depending on your circumstances this may be possible at least at first.

Even if you can afford to pay from income, you should make sure you are claiming all State Benefits you are entitled to as some such as Attendance Allowance or PIP are not means tested.

You may also qualify for a discount, or even exemption on your Council Tax. See State Benefits for further information. 

Using Savings to Pay for Care At Home

If income isn’t sufficient and you don’t qualify for any Local Authority funding, you may have to use savings to pay for any care you want at home until your savings fall below your respective Local Authority thresholds.

This may not be too much of an issue if you are fortunate enough to have considerable savings. Indeed if your savings are significant you even be able to generate sufficient additional income to pay for your care by simply investing it. However, the amount of income generated can never be guaranteed and …

The value of investments and the income they produce can fall as well as rise. You may get back less than you invested. 

Investments will never give you a guaranteed escalating income. So if you want the peace of mind and security of an escalating guaranteed income you may want to consider a Care Fees Annuity.

Care Fees Annuity to Fund Care at Home

In return for paying one single premium, a Care Fees Annuity will provide anyone who is 60 or older and is needing care at home with a guaranteed income which will continue for the rest of their life.

For an additional premium this income can escalate each year which can be helpful when faced with ever increasing care fees.

The income is also tax-free providing it is paid directly to a care agency that is Care Quality Commission registered and providing the income or benefit it provides is no greater than the cost of care.

Should you eventually need to move into a care home, the income can be easily transferred to help towards any care home fees, although due to care home fees normally being more expensive, you may have to consider topping it up by buying a further annuity.

Insurers calculate premiums based on how long they feel they may need to pay.

Consequently, premiums are based on; age, state of health, the income you need it to provide and any escalation or capital protection you may want.

NEW – Quick Annuity Premium Calculator To give you an instant idea of just how much a Level (non escalating annuity) MIGHT cost for any shortfall, providing you are over 80 you can use our immediate care fees annuity calculator.

As premiums for those under 80 vary so much, should you be younger or want quotes for an escalating income the only way you can find out how much an annuity would cost is to ask us to obtain exact quotes for you which we would be happy to do, free of charge and without obligation. To request your accurate quotes, simple click here.

Using Your Home to Pay for Care.

Should your savings no longer remain sufficient, and you do not qualify for Local Authority funding, or you want more care than they can offer, providing you own your own home and are over 55, you could consider releasing some of your home’s value with an Equity Release Mortgage.

These schemes allow you to safely release some of your home’s value without moving, allows you to remain living in your home for as long as you want and decide whether you pay any interest on the money released or not.

The equity released can provide you either with a cash reserve to drawdown only over time, or if you prefer one single lump sum to possibly buy a care fees annuity, however..

This is a lifetime mortgage. To understand the features and risk, ask for a personalised illustration.

More About Equity Release?

A Lifetime Mortgage equity release scheme allows homeowners over the age of 55 to unlock some of their home’s value to give themselves some additional tax-free money and still remain living in the property for the rest of their life or where still married, for the rest of both lives.

The amount of money you can release is solely dependent on age and the value of your home (not income or affordability) and can be either drawdown overtime to help you continue meeting care fees until the money runs out, or you can release it in one single sum – which could then possibly allow you to buy a care fees annuity.

Although interest will be charged, unlike an ordinary mortgage, you do not have to pay the interest – you can allow it to simply build up on the debt.

However, if you do not pay the interest you need to accept the debt will continue to increase overtime meaning you will leave less value in your property for any beneficiaries to inherit or for you to use to fund a care home should you eventually need to move into a home.

It is therefore normally best to only consider releasing equity as a means of paying for care at home if; you are single, have insufficient savings left, and do not want to go into a care home. Even then you should only consider releasing equity after seeking expert advice from someone who is not only equity release qualified but also a care fees adviser.

Being SOLLA accredited later life adviser with over 22 years of experience in equity release, and being an Equity Release Council registered adviser, we are also able to help you safely arrange this as well.