Amid the stress and confusion that comes with arranging for care later in life, it’s easy to miss the financial support available to you or get caught up in promises that smart estate planning can reduce your costs.

But by taking the time to learn about your options and seeking help from professionals, you can gain support in navigating the challenging care environment.

We asked three financial advisors who specialize in later life care for their top advice on financing care. All are accredited by the Association of Later Life Consultants (Solla).

1. See if you’re eligible for any benefits

Catriona Smith, independent financial advisor to Chase de Vere IFA Ltd and member of the Solla Advisory Board:

‘It’s worth looking at the obvious first and seeing if you’re eligible for any government benefits you don’t currently receive. For example, in Scotland everyone who needs it is entitled to a personal care contribution.

‘If you are over state pension age you may be eligible for pension credit and maintenance allowance. Pension credit is given to low-income people, while continuation allowance is not subject to income testing. If you are rejected on the grounds that you are too rich (and I have seen this happen), you can appeal this decision.

‘Someone who is truly ill may be eligible for NHS Continuing Healthcare (CHC), so it is worth asking to be assessed. ‘There is a decision-making process to determine whether an individual has a “primary health need”.’

retirement loan

There are two parts pension credit: guarantee loan and savings loan.

The guarantee loan increases weekly income to £218.15 for singles and £332.95 for couples in 2024-25 and is therefore limited to those with incomes below this level.

The savings loan pays up to £17.01 a week for a single person and £19.04 for a couple. The amount you receive is reduced by 40p for every £1 your income exceeds the threshold (£189.80 a week if you are single and £301.22 a week for couples).

attendance allowance

attendance allowance It is paid at two different rates: £72.65 or £108.55 per week. This depends on level of need rather than income.

If you have a physical or mental disability, meaning you need someone to look after you, you can access care allowance; However, you do not need to have an existing caregiver to request one.

If you move into a care home and your place is funded by your local authority, you will probably not be able to continue receiving care allowance.

Primary health needs

For NHS CHC funding purposes, an essential health need may relate to one of several areas, such as breathing or mobility.

NHS funding is based on medical need and finances have no bearing on decisions made.

Anyone living in a care home who needs significant care may also be eligible for NHS Funded Nursing Care (FNC). This covers additional nursing care needs, but does not cover accommodation costs. There are two flat rates available, £235.88 per week or £324.50 per week.

• Learn more: benefits for older people

2. Consider financing options for care in your own home

Mel Kenny, chartered financial planner at Radcliffe & Newlands Wealth:

‘When you start to run out of money to pay for care in your own home, you may think the only alternative is a care home. Instead, your local authority may contribute to the cost of home care through means-tested direct payments.

‘Even if these payments fall short, there is the opportunity for the local authority to gradually release equity from the home using a lifetime mortgage, while keeping means-tested payments intact. However, this can be difficult to navigate and so independent financial advice is recommended.’

Direct payments

If a needs assessment If your local council decides that you need support with social care and cannot afford it all on your own, you will be given a personal budget. If this money is paid directly to you rather than to a care home or other care provider, it is called a direct payment.

Direct payments can give you the flexibility to arrange your care the way you want; for example, it allows you to hire specific caregivers you already know.

stock version

When receiving care in your own home, the value of your home is not included in the assessment of your assets.

stock version Freeing up some of your home’s value while you’re still living there is an option, but if you move into a care home you’ll need to sell your home and repay the loan.

Release of equity won’t be right for everyone and can be expensive if you can’t keep up with repayments due to compound interest.

If you are interested in releasing equity, you should seek financial advice from a qualified equity release advisor, ideally someone who is independent rather than restricted.

If you take out an equity issuance product recommended by HUB Financial Solutions, Which? We will earn a commission to fund our nonprofit mission.

• Learn more: paying for home care

3. Don’t try to divest assets to qualify for financing

Samantha Gibson, senior wealth planner at Canaccord Wealth:

‘If you are rich, it is a mistake to give away your assets to qualify for financial support.

‘For example, legitimate inheritance tax planning strategies such as putting a home into trust or gifting items under the seven-year rule may be viewed as a deliberate deprivation of assets during the maintenance assessment process.

‘Local councils are very aware of these strategies and are meticulous in their assessment. If you have the means to pay for your own care, the best option is to plan accordingly.’

intentional deprivation of assets

If you apply for council finance you will be subject to a maintenance financial assessment to determine whether the value of your assets falls below the threshold (£23,250 in England and Northern Ireland, £32,750 in Scotland and £50,000 in Wales). is eligible to receive support.

Intentional deprivation of assets is when someone gives away money, property or other assets to qualify for local government funding. The council will look at previously held assets to assess whether any disposals were deliberate.

If you are deliberately deprived of your assets, you will be liable to pay the costs you owe, regardless of whether you owe money or not. The municipality may recover costs from both the person who disposed of the asset and the person who acquired it, and may even take court action to recover the costs.

• Learn more: Can I avoid maintenance fees by giving away property and assets?

Advice on your options

There is no ‘one size fits all’ solution to how best to fund later life care; Therefore, you may consider working with an expert financial advisor to find a solution that suits your needs and financial situation.

Not all consultants are qualified to deal with later life care finance, but Later Life Consultants Association (Solla) directory for accredited consultants in your area.

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