While selling your home to pay for care may feel necessary, it’s not your only option. With careful planning and the right information, you can explore alternatives that protect your property while ensuring you get the care you need.
This guide will explore practical options to manage care fees without having to part with your home.
How to avoid selling your house to pay for care
Many people are unaware of the financial strategies that can help them avoid selling their home. Whether it’s through government support, equity release, or other funding options, there are ways to stay in your property while covering the cost of care. Here are some of the most effective solutions:
Government funding and financial assessments
If you meet the criteria, you may be eligible for government assistance with care costs. Local authorities conduct financial assessments to determine your eligibility for support. While your home may be factored into the assessment, that doesn’t mean it has to be sold. Financial support options may allow you to remain in your home while your care costs are covered, with repayment deferred until your property is sold later.
Equity release
Equity release is a financial option that enables you to access the value tied up in your home without selling it. This could be a suitable option if you need immediate funds for care. The loan is repaid when your home is sold, often after your passing. Although equity release can provide the necessary funds, it’s important to understand the long-term implications, as the amount owed increases with interest. Speak to a financial adviser to ensure it’s the best choice for your needs.
Downsizing
If your current home is large or no longer suitable for your needs, downsizing can free up funds while still allowing you to retain ownership of property. Moving to a smaller, more manageable home can reduce the financial strain of maintaining a larger property and provide you with additional capital for care costs. When downsizing, remember to consider all associated costs, including legal fees and moving expenses.
Deferred payment schemes
If you’re unable to pay for care upfront, deferred payment schemes offered by local councils allow you to remain in your home while the government covers your care fees. This gives you more time to evaluate your options, and you won’t need to sell your property right away. The loan is repaid when your home is eventually sold, which can provide flexibility and peace of mind.
Long-term care insurance
Long-term care insurance can be a practical way to ensure you’re financially prepared for care costs. By securing a policy early, you can lock in more affordable premiums and ensure that funds are available when you need care. Although the premiums may be high initially, the peace of mind knowing you have coverage can make it easier to avoid selling your home when the time comes.
Related: What kind of insurance do landlords need?
Making informed decisions about care and your home
These answers will help you understand your options and make the best choice for your circumstances:
Do I have to sell my house to pay for care?
No, selling your home is not your only option. There are other ways to manage care costs, such as accessing government funding, using equity release, or downsizing to a smaller property. It’s essential to evaluate all available options before making any decisions that could impact your future.
Will the government make me sell my house?
In many cases, no. Local authorities often offer deferred payment schemes, allowing you to stay in your home while your care is funded. The costs are then repaid when your home is eventually sold. This gives you time to explore other options without rushing into a sale.
If I sell my house, does that mean I have to move into a care home?
Not at all. Selling your property doesn’t automatically mean moving into a care home. There are plenty of alternatives, such as in-home care or supported living arrangements, which allow you to remain in your home or move to a more suitable property. The choice depends entirely on your preferences and needs.
Are care homes my only option for receiving care?
No, care homes are just one choice among many. Many people prefer domiciliary care, where carers visit their home to aid. This allows you to stay in a familiar environment while receiving the support you need. Other options like sheltered housing or retirement villages might also be suitable, depending on your level of care needs.
Can I still pass my house on to my children if I need care?
With the right planning, yes. Some individuals place their property in a trust to ensure it remains within the family. However, setting up a trust requires legal advice, so it’s important to work with professionals to ensure your home is properly protected for future generations.
Related: What are property deeds and why are they important?
What’s the best way forward?
The right solution for funding care depends on your individual circumstances. It’s always a good idea to consult with a financial adviser to ensure you’re exploring all the best options for your situation.
Our team of experts can guide you through your choices and help you find the best solution for your future.
If you need assistance in navigating your options for care funding or are considering selling your home, contact your local Ellis & Co branch.
