How to fund your live-in carer

Date: September 13, 2022

Author: Izzi Parsonage

There’s no getting away from the fact that the decision to bring care into your home is an incredibly difficult and emotive one. But it is one that is wrought with a number of practical challenges too. Not least, deciding what types of care you need and working out how you will pay those care costs.

The first question can be resolved by working with a reputable care provider or care agency who will be able to carry out a needs assessment and give you advice. However we understand that when it comes to covering the cost of care, things may not be so straightforward.

That’s why we wanted to set out your options when it comes to funding your live-in care?

Are you entitled to funding?

Whether you’re looking to pay for live-in care costs in the UK or residential care costs, the first question has to be whether or not you’ll be entitled to local or government funding.

In order to find out, you’ll first have to prove that there is a need for care. This is done through a care needs assessment conducted by the adult social services department of your local council. There will be no charge for this assessment.

Once your care needs have been assessed and agreed, the local council will perform a financial assessment or means test. This will involve asking questions about your monthly income, savings and property in order to calculate the amount you will need to contribute towards the cost of your care and support. Unfortunately, unlike NHS healthcare, social care is not free. However, if you’re looking for care in order to stay in your own home, perhaps with domiciliary care, the means test wont include the value of your property.

If you are means tested as having capital over a certain sum – currently £23,250 – you will have to pay your own care fees as a ‘self-funder’. Below this, you should qualify for some funding options. If you are eligible for financial support to pay for homecare you can either ask your local council to arrange it for you or you can elect to receive direct payments and then arrange care services yourself.

What if you have to self-fund?

If you don’t have sufficient funds just sitting around in the bank, and many of us don’t, the most common mechanism for self-funding care is through equity release.

This may feel like a big decision, but can be a useful option if it allows you to remain independently in your own home for longer.

In order to release equity from your home you’ll need to choose one of the available equity release schemes and go through a reputable professional such as SOLLA The Society of Later Life Advisers. They are a group of financial advisers who are specially trained to understand later life financial matters and will be able to take you through the process quickly and efficiently.

Could you be entitled to benefits or allowances?

Whether you’re eligible for financial help or you will be funding your ongoing care yourself, it’s worth looking into whether you’re entitled to any government benefits or allowances. Many of those relating to disability and care costs are not means tested and therefore will not be impacted by your income or savings.

You’ll also find that any means testing is done under the assumption you are receiving everything you’re entitled to. This makes it particularly important to have done your research if you’re hoping to be assessed for funded care.

Here are some of the key ones to look into.

Attendance Allowance

Attendance Allowance is a benefit you might be able to claim if you are over state pension age and need help with care due to a long-term health condition or disability. It is not means tested and so doesn’t depend on any capital or savings you might have.

The Attendance Allowance can be used in any way you wish, the idea being it can help you stay independent, in your own home, for longer.

You can find out more here: Attendance Allowance: How to claim – GOV.UK (www.gov.uk)

Personal Independence Payment

The Personal Independence Payment (PIP) is a benefit available to people who need help with daily activities because of a long-term illness or disability.

The PIP is assessed in two parts: a daily living component and a mobility component. How much you receive will depend on how difficult it is for you to do certain things.

To be eligible for the PIP you must be under state pension age but it is not means tested, it doesn’t matter how much you earn or how much you have in savings. If you need help with daily living activities, getting around, or both, you may be eligible.

You can find out more here: Personal Independence Payment (PIP): How to claim – GOV.UK (www.gov.uk)

Disability Living Allowance

The Disability Living Allowance (DLA) is a monthly, tax-free benefit for disabled people, designed to help with care and mobility needs if you’re living with a disability.

It is gradually being phased out and replaced by the Personal Independence Payment or Attendance Allowance depending on your age. This means you can no longer submit a new claim.

If you live in Scotland, this is known as the Adult Disability Payment.

Carers Allowance

If a loved one or family member is taking on some of your care requirements, for example food shopping, personal care or taking you to and from regular appointments, it may be that they are entitled to a care allowance.

It might be that they just think of themselves as helping out a friend or family member, but if you feel you would struggle to manage daily life independently without their support, they may well be entitled to a little extra money.

The current rate, to April 2023 is £69.70 per week and is usually paid every four weeks. If they’re under state pension age they may even be able to get National Insurance credits as well as a universal credit uplift depending on their situation and caring duties.

Claiming some benefits, such as Attendance Allowance or Carers Allowance may also unlock the option to apply for other extra benefits if you are on a low income. Here is a non-exhaustive list of some other benefits that might be worth investigating:

Pension Credit: Pension Credit: Overview – GOV.UK (www.gov.uk)
Council Tax Reduction: Apply for Council Tax Reduction – GOV.UK (www.gov.uk)
Housing Benefit: Housing Benefit: Eligibility – GOV.UK (www.gov.uk)
Universal Credit: Universal Credit: Eligibility – GOV.UK (www.gov.uk)
Warm Home Discount Scheme: Warm Home Discount Scheme: Overview – GOV.UK (www.gov.uk)
Cost of living payment: Cost of Living Payment – GOV.UK (www.gov.uk)

If you need help and support to navigate the minefield of funding a private live-in carer from Promedica24, get in touch. We’ll be happy to help.

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