How To Fund Care - An Introduction
Needing care is stressful enough as it is. Often a family is plunged into the care world in crisis – a fall here, a diagnosis there. What follows is a tsunami of hospital appointments, care assessments, GPs, local authorities, care homes, help at home, care aids. Then there’s the difficult question as a family, how are we going to pay for it all? The financial side can seem very overwhelming, very quickly. We strongly recommend you take specialist later life financial planning advice from a SOLLA-accredited IFA such as Harold Stephens. Preferably a local IFA who knows the area, can meet with you on-going, on a face-to-face basis, and gain an intimate understanding of the full picture and the wider family dynamics.
What is an IFA (Independent Financial Adviser)?
An IFA is an independent financial adviser that is authorised and regulated by the Financial Conduct Authority (FCA). IFAs can recommend all types of retail investment products and pension products from firms across the market without being restricted. A financial adviser can only become an IFA once they are approved and regulated by the FCA. This means that anyone seeking out financial advice should feel more confident when engaging with an FCA regulated IFA.
When looking for an IFA, it is important to realise that IFAs vary hugely terms of what each does best, what experience they have and what specialisms they might have. For example, some IFAs specialise in mortgages, some IFAs specialise in company pensions and wider corporate planning whilst other IFAs only work with certain professions like doctors or dentists. Many IFAs can be called ‘generalists’ and try to do a bit of everything without really having a specialism.
At Harold Stephens, our one and only specialism is later life financial planning. It is what we do, and this specialism runs through every person and process in the firm. From the receptionist having a ‘sixth sense’ for any client vulnerabilities that we need to adapt our services to, to our community engagement with the Later Life Alliance and Later Life Hub, to our SOLLA-Accredited advisers with their deep later life financial planning technical knowledge and gentle, patient style. Harold Stephens has for many years, been known as the trusted source of later life financial planning advice in North West Bristol and surrounding areas.
Why SOLLA (Society of Later Life Advisers)?
SOLLA was launched over 20 years ago with the aim to create a specialist later life financial planning community of IFAs. It is deliberately a challenging group to be a member of, with IFAs going through a re-accreditation process every 5 years. The technical later life financial planning knowledge required is deep and the qualification process is arduous. Requiring not only a pass in traditional technical examinations but also involve practical role-plays, designed by lawyers, to test advisers’ client-facing technical knowledge and ‘soft-skills’.
It is re-assuring to know that, from a client point of view, you’re dealing with the best of the best, in terms of later life financial planning. Really, if you’re looking at any post-retirement issues you should, at the very least, be approaching a SOLLA accredited financial adviser.
How To Get Help?
If you, or a family member, is embarking on the care journey the first step is to get in touch with us at Harold Stephens. Laura will arrange for one of our SOLLA qualified later life financial advisers to give you a free call back, mainly to get an idea as to whether we can help or not and to answer any immediate questions you may have about the way forward.
If we can add value to your situation, we will invite you and the family in for a free initial meeting in our homely, living room style office on Westbury on Trym High Street. Let us know at this stage if we need to adapt anything to meet the circumstances or we need to meet in the house, hospital or care home. We will let you know what detailed financial and health information you need to bring to that first face to face meeting.
At the end of the initial phone call or the first face to face meeting stage, if we cannot add value to your circumstances or feel that your situation requires a different set of skills or experience we will then sign-post you to one of our trusted partners who will be able to help.
what are the Funding Options?
One of the potential routes to care funding is the Immediate Care Plan (sometimes called a care annuity). Something of a secret it seems to the general public (and even, more worryingly, amongst care admission teams and families entering into care). This is a secret that more families entering care really need to know more about.
The great benefit of an Immediate Care Plan is it provides, in return for a lump sum, a guaranteed income for life to go towards paying for care. Regardless how long you live, the income will continue to be paid. This gives loved ones and their families the peace of mind to know that the money will not run out and their care setting of choice is protected for life.
In addition, Immediate Care Plans receive special dispensation from the Inland Revenue, allowing them to be paid free of tax. A major benefit because income would normally be taxed.
Immediate Care Plans are only available through IFAs who have passed specific qualifications to advise on them. Better still, seek out a SOLLA qualified IFA who can look at the whole picture and all of the care funding options available for your assets. This is especially the case if you have significant wealth in the form of property and / or cash savings and investments. As an aside, if you or a loved one entering care also has inheritance tax issues then there are options to explore that can kill two birds with one stone. Again, get in touch for specialist advice immediately if this is the case.
Another form of potential funding that can ‘slip through the net’ is Continuing Health Care (CHC) where basically the NHS agree to pay all the care fees. This is extremely difficult to get and is reserved for only the sickest in later life. The criteria is tough, however due to extremely stretched budgets, the NHS do make it deliberately tough. At the very least be aware that CHC funding exists and look to explore the application options. There are specialist firms we can sign-post you to if you feel you have a case for CHC funding but are not being listened to. In the first instance, speak to us.
Deferred Payment Agreements can be useful in certain circumstances. Here, the Local Authority agree to continue to pay for your care costs even when you have run out of money, but in exchange for this they put a debt on your property. The Local Authority will charge interest at an agreed rate, and the interest rolls up along with the fees paid and so over time a debt accrues against your property. Basically, when you die, the family will have to sell the property and the solicitor handling the sale will settle the debt with the Local Authority. In a very similar way, Equity Release can be arranged as a way of releasing money out of your property for whatever you want to use the money for (in the case of long-term care for example home help costs, home adaptions). Again, like DPAs above, this creates a debt on the property with a rolling up of interest that eventually needs paying off – usually on death or on moving into a care home.
Free Care Information Events: Reserve Your Place
At Harold Stephens, we’ve helped many families across Bristol navigate the financial side of later life care with calm, clear advice. If you are looking in to paying for care for yourself or for a loved one, we understand it can feel overwhelming, but you don’t have to figure it out on your own. Join us on one of our warm, jargon-free, practical sessions to help you make informed choices about your future, book your place on either:
Tuesday 11th November 3.30pm - 4.30pm, Stoke Lodge, Shirehampton Road, Stoke Bishop BS9 1BN
Wednesday 19th November 1.30pm – 2.30pm, Stoke Lodge, Shirehampton, stoke Bishop, BS9 1BN
You can book directly by phone on 0117 3636212 or email us at office@haroldstephens.co.uk