How to save money for care home fees
Saving money for care home fees isn’t a glamorous topic, but there’s no use burying your head in the sand when it comes to your later life finances.
Recent research found that a third of those approaching retirement were unable to estimate how much income they are set to receive from their private pensions.
So what are the best ways to ensure that your finances are in order and you’ll have sufficient capital set aside in later life?
- Savings
In the current economic climate, handling your money wisely is a vital concern. The type of account you choose to deposit your funds in is massively important, so it’s well worth doing some research in this regard.
Dedicated savings accounts often come in handy for those looking to bolster their funds through interest. Similarly, many banks will offer retirement packages that are specially designed for savers in later life.
- Investments
Assets can really come in handy for those looking to generate capital and there are a range of investment opportunities available that are especially useful for those saving for retirement and beyond.
Brokers can offer a wealth of expert advice on good purchases, but in general, you’ll be looking for secure investments that mature slowly.
- Property
It’s not uncommon for property to be used to help generate money for care home fees. However, it’s not always necessary to sell the home you’ve lived in all your life.
Many people opt to purchase a second property while still in work, which can be of great use when finance is required for a care home. You may also want to investigate renting out your second property as this can be a handy way of dealing with mortgage costs.
Once that’s paid off, the rent can be placed into a savings account that can be tapped when the need arises. This will enable you to reserve your primary property for inheritance, as well as helping to mitigate care home costs.
- Who pays what?
It’s important to get to grips with the various costs associated with care homes. Those with savings of more than £23,250 are responsible for the majority of fees, while those with less are typically eligible for support from their local authority.
Similarly, those with a serious, long-term health condition could qualify for NHS Continuing Healthcare when entering a care home. This will result in the NHS footing the bill for the facility, meaning you can avoid care home fees.
Planning ahead and investigating the best financial options available means you can mitigate the cost of a care home and ensure you have sufficient assets left over to pass on to your loved ones. While it may be tempting to put off such momentous decisions, the sooner you take action, the less you’ll have to worry about the situation in later life.
