Private funding solutions

Funding the cost of care from your own or your family’s assets is a daunting prospect. If Local Authority help isn’t available, then there are a number of options on offer.

  • Pension and Investment Income can be used if the portfolio generates sufficient return Immediate
  • Care Plans, which provide an income for life to top up existing income.
  • Equity Release or Lifetime Mortgages for very specific family situations
    Pension and Investment Income

There are many types of pension and investment vehicles that can provide a regular income to help cover the cost of care. In addition, new pension income rules now offer greater flexibility in the way you can draw income from your pension pot. Almary Green’s Later Life team members are all highly qualified Independent Financial Advisers and can provide individual advice on the optimum portfolio for your assets and your attitude to risk. See our pension and investment pages.

Immediate Care Plans

Those in need of care either in a care home or in their own home can purchase a special type of annuity designed specifically to provide help at the time care is needed – or at any time whilst in care if there are concerns about the money running out.

These special annuities are purchased using a lump sum payment and provide a guaranteed income to pay for care fees. Payments are generally made direct to the care provider (and are not then taxed as income) on a yearly, quarterly or monthly basis and provide a top-up to existing retirement arrangements to meet the shortfall between existing income and the cost of providing care.

As with all annuities, they require a substantial one-off capital payment at the outset, but once the money has been spent, they guarantee a life-long income, leaving the rest of your assets untouched. Once set up, they cannot be changed, although protection against inflation and death in the first few years of the plan can be built in if required.

The cost of the plan will vary with individual circumstances – we will obtain quotations from plan providers on your behalf to ensure you get the best possible deal. What is significant is that the terms available from an Immediate Care Plan can be considerably better than those provided by standard annuities as these plans are medically underwritten at the outset.

To find out more about how we can help you find the right Care Plan, contact us using our Enquiry Form – or give us a call.

Equity Release and Lifetime Mortgages

There will be occasions when selling the family home to raise money to pay for care fees is not appropriate or desirable.

As an alternative to selling, a range of other lifetime mortgage and equity release products can be found that might prove useful in specific circumstances. We strongly believe that great care should be taken to ensure that everyone involved understands the implications of this type of arrangement and that additional legal advice is taken if needed.

There are three main types of scheme available:

  • Interest only mortgages where interest payments are made throughout the loan period and the loan amount is repayable in full on death.
  • Lifetime mortgages where both the amount borrowed and the accumulated interest become payable on death.
  • Home reversion plans where ownership of all or part of your home is transferred to a provider and you receive the value of the property either as a lump sum or a monthly income. Plans vary—some involve paying a nominal rent whilst others provide rent-free occupancy. When the property is sold, the provider will receive the value, or a proportion of the value, of the property at that time.

Our team includes equity release specialists who will ensure that you and your family thoroughly understand the detail of any arrangement under consideration, and we will only recommend providers who follow the EquityRelease Council's code of practice.

Any mortgage or equity release arrangement will, of course, have a significant impact on the estate you will be able to leave your heirs, and it is critical that any such arrangement provides not only for the cost of care, but also any repayment or rental fees involved.

Equity release may involve a lifetime mortgage or home reversion plan. To understand the features and risks, please ask for a personalised illustration.

CHECK THAT THIS MORTGAGE WILL MEET YOUR NEEDS IF YOU WANT TO MOVE OR SELL YOUR HOME OR YOU WANT YOUR FAMILY TO INHERIT IT. IF YOU ARE IN ANY DOUBT, SEEK INDEPENDENT ADVICE.

Please contact us to discuss the suitability of an Equity Release arrangement for you.

There will be a fee for mortgage advice.


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