Many people, as they grow older, worry about where they will live if they can not manage in their own home. Some of us will need to move into a retirement home or nursing home (in this article referred to generally as "care homes"). There are some myths about the process and hopefully this article will deal with some if not all of these, but there is no substitute for taking face to face advice.

Will I have to pay the full cost?

The cost of care varies greatly. It will depend on the kind of care needed and the facilities the care home offers. Some care homes are for our basic needs as we grow older; others will provide full blown nursing care.

When you move into a care home the local authority will assess your financial circumstances to see whether or not you qualify for help with the fees. Both income (private and benefits based) and savings are relevant to the assessment. Your property will also be included in the assessment, though there are circumstances where this is not so.

Virtually all of your income will be used to fund the fees, irrespective of your capital. You will be entitled to keep £21.90 per week for basic needs (2009/10 rates). You will be expected to pay the full cost of the care (in other words the balance after whatever your income has covered) if your capital exceeds £23,000.00 (2009/2010 rates).

The local authority must disregard the value of your home for the first 12 weeks after your permanent admission into a care home. During this period the local authority must assist with your fees if your remaining capital is below £23,000.00 (2009/2010 rates). After this time the local authority will include in the assessment the value of your home. This will probably mean your contribution to the payment of your fees will increase and the local authority will expect this to be met either from your available liquid resources or the sale proceeds of your home in due course.

If you are paying for your own care you may be entitled to claim Attendance Allowance, which is a non means tested benefit paid for by the Department for Work and Pensions.

Shared assets

If you and your partner own your own home jointly and either or even both of you need to go into a care home then it is sensible to ensure that the way you own the property is looked at and your Wills are updated. If you leave everything to the survivor then everything is assessable on the survivor. If you left your half of the property to the children for example, then that half is protected after your death and the survivor is only assessed on his or her half of the property.

It makes practical sense to physically divide any jointly owned investments or cash accounts. This is will make it much clearer when looking at what assets belong to whom when completing the assessment forms. It will also help to identify when any application for funding should be made if the assets exceeded the capital limits to begin with but have since inevitably been depleted to meet the care home costs.

Selling your home to meet the costs

This is often practically the only answer to the requirement to pay for your own care, though the local authority can not actually compel you to do so. However before doing so explore with the local authority, your solicitor and an independent financial adviser the various options available to you.

There are an increasing number of financial products on the market that may prove to be a better option than simply selling the property and putting the cash on deposit to meet the monthly fees.

Free nursing care

If you are paying for the cost of your care home you are still entitled to have the nursing element of that care paid for by the National Health Service. This relates to care provided by a registered nurse as distinct from general help with activities of daily living.

The NHS will pay a set amount according to the level of care required and this is paid directly to the care home.

Also available from the NHS is Continuing Healthcare and fees can be paid in full by the NHS in certain circumstances.

Giving away assets

If you give away assets in order to avoid having to use them to pay for your care home fees this may well be seen by the local authority as a deliberate deprivation of capital. If that is the case the local authority can assess you as though you still own those assets given away, which could mean that you would then be liable to pay for your own fees. The local authority can look back as far as they wish to try and determine whether any gifts were made predominantly with a view to enhancing your rights to local authority funding. Conventional wisdom therefore states the earlier the gift is made the better.

Book a Free Appointment

Frettens are pleased to offer a free initial consultation for all new clients. We have always offered this service because we recognise the importance for clients of deciding whether they can work with a particular solicitor and to find out more about the process and likely outcome. Our private client lawyers offer positive, down to earth advice, and we hope that this initial meeting allows you the time to see this as well.

Contact a member of our Private Client Team to arrange a free initial appointment at either our Christchurch or New Forest office, where you will be able to meet your solicitor with no obligation or charge.