Do Self Funders Leave it Too Late to Seek Long Term Care Advice?

Determining how to pay for long term care can be a stressful and confusing experience. However, this can be especially true for those who find out that they must pay for their own care. These self-funders are often left to find unique and innovative ways to fund the care they need in their later years of life. However, it is possible for each and every consumer to research the resources available to them as well as the overall costs of long term care earlier in life which can help them to avoid a panic when it comes time to enter into long term care.

The experience of many people who enter care is that once their needs have been assessed and the financial assessment has been carried out, they find that they are required to pay for their own care. This means that they have been found to have assets over the current threshold of £23,250. In this event, they are told that they will have to fund their own care and they are then left to their own devices to source the care they need and determine how they will pay for it. This situation is really short sighted of their Local Authority as someone with considerable assets could be referred for specialist financial advice which could enable them to provide funding for their care for life. In reality very few Local Authorities have a system in place to do this.

If everyone entering care that is assessed as being a self-funder were to be referred to a specialist for financial advice at the start of the process they may be able to secure a Care Plan Annuity. This is a plan specially designed to pay the annuitant a guaranteed income for the remainder of their life. However, the key here is that the plan needs to be started earlier rather than later. That means that being prepared for long term care can really serve to save the patient not only a great deal of money but also a great deal of stress when it comes time to plan how to pay for needed care.

It is not unusual for an elderly person to head back to their Local Authority after just a few years of living in care. This is most often because the patient had substantial assets, income, and capital at the start of their care and was therefore, considered a self-funder. However, following a few years of living in care, they may have already spent down all that they had available to them. Depending on the cost of their care, it is possible for many consumers to deplete all of their income and assets in just a couple of years. Should that happen, many consumers are forced to head back to their Local Authority to once again request financial assistance.

Far too many people in care leave it too late to seek financial advice. They wait until they need care to seek out advice. Worse even, they wait until they have exhausted all of their assets and capital to look for financial assistance options. They often consider this course of action once their funding has run out at which point there are left with little options but to revert to their Local Authority for funding. However, if they had started their research sooner, they may have actually had other options available to them. For example, many elders would find that investing in a care plan annuity could have been their best option. And most importantly, they would not have to wait until the last minute to purchase their plan.

Immediate care plans, or care plan annuities, function in much the same way as a standard annuity contract. The participant pays a larger sized lump payment up front in exchange for regular payments made directly to a care provider. These plans work very well in bridging the gap between the cost of care and the income of the participant. Furthermore, the price of the plan and the size of the lump sum payment are both very specialized to each individual participant.

With a care plan, policies are underwritten on an individual basis. This is because the plan takes into account several personal pieces of information including current health conditions, life expectancy, age, and how long the individual is expected to need long term care. Because the plan is individualized for each participant, the rates of return can be considerably higher than that of a standard annuity or savings plan. Providing the income from the Care Plan Annuity is paid directly to the registered care provider, it will also have the added benefit of being paid tax free.

It is always advisable for those who need long term care to see out advice as soon as possible. There are options available to those who need to pay for their own care and there are more of those options earlier in the process, including the care plan annuity. Once capital and assets have all been liquidated, there are very few choices left for those who need to fund their care.