Lowes Magazine Issue 121

LATER LIFE

Update on Later Life Care planning

reach the cap. It has set a notional amount for that of £200 per week. A calculated example of how this might affect an individual in care shows that an individual paying a total of £700 per week to a care home will have £200 of that amount deemed as daily living costs while the remaining £500 will count towards the £86,000 care cap. If an individual has a pension of £200 per week or more, including their state pension, this could be used to finance the ongoing room and board costs. Making sure they have other assets of £86,000, potentially by putting money aside and ring-fencing it for the potential need for later life care, could then cover the care element and give comfort that any remaining savings can be passed on as an inheritance. In December, Public Health England released its latest Healthy Ageing Profile data. This showed that healthy life expectancy for the UK is approximately 20 years less than actual life expectancy 1 . These announcements reinforce the need for effective Later Life Care planning. People tend to shy away from talking about death as well as the possibility that they might become ill when they are older. We should be financial planning for both scenarios.

THE GOVERNMENT HAS ANNOUNCED MORE DETAILS of the social care reforms planned for October 2023, revealing what people in residential care will be expected to pay per week for daily living costs to cover food, accommodation and utility bills. In September 2021, the Government unveiled new plans for adult social care reform in England, including a £86,000 lifetime cap on the amount anyone in England will need to spend on their personal care from October 2023, alongside a more generous means-test for local authority financial support. In November, the government published further details on the new reforms, including the standard level at which ‘daily living costs’ will be set. The Department of Health and Social Care said that for individuals who receive financial support for their care costs from their local authority, it is the amount that the individual personally contributes that will count towards the cap, i.e., not any welfare support. It has also said the upper limit at which people become eligible to receive some financial support will rise to £100,000 from the current £23,250. The new threshold means people with less than £100,000 chargeable assets will not contribute more than 20% of these assets per year. Meanwhile, the lower capital limit – the threshold below which people will not have to pay anything from their assets – will increase to £20,000 from £14,250. The Government said the new £86,000 lifetime cap will not cover daily living costs for people in care homes and people will remain responsible for their living costs including after they

If you’re concerned about potential long term care costs, speak to Lowes today, please call us on 0191 281 8811 and we can arrange an initial consultation.

1 Source: https://fingertips.phe.org.uk/profile/healthy-ageing

13 Lowes.co.uk