Paying for care – what’s changing?
Back in September last year, the government announced there would be a few changes to how we pay for adult social care from October 2023. To help you understand the changes, we’ve summarised them here.
- Now you pay care fees in full if your capital is more than £23,250. From October 2023 you pay care fees in full if your capital is more than £100,000.
- Now expect some financial help towards care fees if your capital is between £14,250 and £23,250. From October 2023 expect some financial help towards care fees if your capital is between £20,000
- Now the majority of care is paid for by the state if your capital is less than £14,250. From October 2023 the majority of care will be paid for by the state if your capital is less than £20,000.
- Now there is no cap on care fees. From October 2023 the cap on care fees will be £86,000.
Will these changes make a difference?
Capping the amount you pay towards your care fees may seem like a lifeline, but the £86,000 cap is only for the care element of the fees, not for living costs such as your accommodation, food and heating. And the cap is based on the standard fee that a local authority would pay for care, not what your care home actually charges. You will also need to be assessed as eligible for personal care before anything you spend starts to count towards the cap.
Let’s look at an example.
If your local authority pays £300 per week for personal care fees, it will take five and a half years before the cap is reached.
Your care home charges you £800 a week – including your accommodation, food and heating, so you’ll have spent more than £228,000 by the time the personal care cap is reached.
Even when the cap is reached, you’ll need to pay the £500 a week difference until the value of your assets drops below the £100,000 capital threshold. This means many people may still need to fund much of their care from their savings, investments or selling their home.
Through careful planning and consideration of all the options, we can help you understand your options and make the best decision for your circumstances. Remember, these changes don’t come into effect until October 2023. Any costs incurred up to that date will not count towards the £86,000 personal care fees cap.
You can read our complete guide to planning and paying for care by downloading our ‘Funding long term care’ brochure.