Self funded care - what happens in England when/if savings run out

[Motherbear44]

Mum is 96 and on the verge of moving from living alone in her own home (with four carer visits daily) to a care home. She has savings over £23000 so I know that she will have to self fund. She has an Attendance Allowance, I assume she keeps that and has something to put towards the fees.

But does anyone have any experience of what happens when her savings run out? She is in poor health - but money from selling her two-bed bungalow in the Midlands will not last long. Will she suddenly have to move to a cheaper home?

Prices of care homes can vary by up to £500 a week. My thoughts are that the money will run out anyway. With the expensive option it will run out sooner. Does that really matter? I have Lasting Power of Attorney but if she is reliant on state funding for her care how does it work.

I don’t actually think that the most expensive home will be the best for everyone. I think the ambience must meet the residents’ needs, some like peace and others like laughter.

This journey is going to be tough. I Would be very grateful to hear some personal stories because I don’t think I should be worried about financial issues - but I am.

@Motherbear44 I’m sure more knowledgeable people than me will be along but I found MN a massive help when I needed to move my Dad in to residential care and use the LPA to sell his house to fund it, so I hope this helps and bumps your thread up the list.

A few things would be helpful to know, to help you:

Do you want to move her out of her current area (if that would mean nearer you or someone else)?

Does she have nursing needs - so a care home with nursing care? Or other specific needs?

There are useful leaflets on the Age UK website but you may need a little bit from a few different ones so:

It is worth finding out which care homes take both LA funded and self-funded residents - you can ask this when you look. That should make any future transition to LA funding easier. Some homes want evidence of at least 2 years fees (but they might take the bungalow into account).

Do not sign anything agreeing to ‘top up’ fees to LA payments or as ‘guarantor’ - sign as LPA spending her money.

I’m not sure if any care assessment has been done by a LA social worker or if the 4 carer visits were set up self-funded. At this point it sounds like you can choose if and when she moves and where - once you have moved her, a Deprivation of Liberty Safeguarding authorisation is likely to be requested (by the home) from the LA. The social worker may invite you as LPA to an assessment and advise when to tell the LA money is running low.

On first moving from home to a care home in our area when savings were below £23k there is a 12 week disregard on the value of the property to allow time to sell (and we also got a refund of council tax).

Don’t sell the house. The council has to offer a deferred payment arrangement. The benefits of this are that if a local authority (council) bed can be found, your mum will be charged a lower rate than if you are fully self financing it. My mum was in a care home which had a proportion of council beds. These cost £650 per week as opposed to £1000 if we had sold her house and she was paying. When she passed away the house was sold and we paid the bill to the council. Most councils won’t tell you this but it is the same in every area.

And if the money (the value of the property plus assets less £23,000) ran out, if she was already in a home with council beds they would be unlikely to insist she moves somewhere cheaper (if they did you would fight it at that point).

Care homes have advisors who know their way around the systems really well. Pick one or two you like (I totally agree about ambience & ethos) and talk to them about funding options.

Hope it goes well for you. My mum was very comfortable at her nursing home, they couldn't have been nicer, and she was getting all her meds & treatments on time for a change.

When my mum needed to go into a care home, aged 91, my sister and I researched locally to find a good home that took both self and council funded. We anticipated her funds would run out and preferred that she wouldn't have to move.

A few months before her funds reduced to the 23k mark, we met with the care home manager and had to complete a financial assessment. She was also assessed by the council welfare people. They agreed she could stay at the home, with council funding, but she would be transferred to a more basic room (she had a lovely room) unless we agreed to top up the fee. It was about £600 a month and just not feasible. In the end it was all academic as she died before being moved to her new room.

We and, more importantly, mum were very happy with the level of care she received, and from what we witnessed any council funded residents received exactly the same care, albeit in a more basic room, so we would have been happy for her to continue living there if necessary.

@AnotherDisappointingAvocado
@FiniteSagacity
@GarlicFind
@PoppySaidYesIKnow

Thank you so much for all of these responses. These first-hand accounts are exactly what I needed.

We had thought over the question of whether to move Mum somewhere more accessible to us, I now see why that might not be so wise.

I had heard of the deferred payment. Now I see that not selling the bungalow is not just about having somewhere to stay when I come to visit (I don’t live in UK).

I see the need for asking about the home having fully self funded and council beds.

We organized the care without a council Social Worker. We had got to know a company that worked with Dad for six months before he passed away two years ago. We kept them on doing what were mainly ‘welfare’ visits twice a day when mum was first on her own. Gradually they have increased the amount of support they have given to including administering meds and preparing meals 4 times daily. I suppose the downside is that we do not have anyone to ask the questions that we do not know need asking.

Thank you all.

Yes it was similar for my grandfather, though it was £850 rather than £1200 for him.

If you don’t sell the house, do factor in the costs still payable on utilities, insurance etc.

If i was a care home I would want to know funding before letting her move in, as realistically she only has a few weeks of liquid assets.
I'm feeling as if I have read here that some places like you to have 2 years funding available or agreement from the LA?

You said ‘the money will run out sooner in a more expensive home, does it matter’.

It does matter from the point of view that if she is in a less expensive home Social Services are likely to leave her there when they start paying. They would have no reason to move her. But if she is in a £££ home they may well want to move her to a cheaper one.

I chose an inexpensive care home for my mother with that in mind, and when her savings ran out Social Services continued to fund her in that home.

And yes she will continue to receive AA in the care home as long as she is self funded. If she moves to LA funding, at that point you will have to cancel AA.

https://www.ageuk.org.uk/

These chaps have all the answers you need.

Sell the house - you'll have ongoing payments if you don't. Empty homes insurance is more expensive than normal insurance, you have to visit the property weekly as part of the insurance, keep the heating set at a certain level etc, some require alarms and cctv. Also if the council agree to put a charge on the property (sell it when your parent dies) they will charge you a minimum of 4% interest to do so. Sell the home and put the money somewhere where it earns a decent interest rate or get some kind of annuity which guarantees to cover the care home fees for as long as your Mum is there.

I agree I would sell the house. You live abroad and won't be able to check on it regularly, and without supervision it could quickly fall into a bad state of repair which will cause hassle and expense. And you will of course have the ongoing costs of an empty house, as the PP has said.

Don't under-estimate the cost (and worry) of maintaining an empty house for a potentially long period though, especially as the OP says they are not in the UK. Is there anyone more local to keep an eye on it ?

There will almost certainly be be an empty home premium on council tax after a year or two, meaning it could double (although I think there may be discretion if the occupant is in care) and insurance will be costly and with a lot of provisos - they'll probably expect the water to be drained or temperature set at a minimum and all valuables (including things like TV's) to be removed.

And don't forget that if sold, much of the money raised will be earning interest before having to be paid over for care....

I hear you but I can say from our experience the upkeep of the house was worth it for what we saved in care home fees. Insurance was around £300pa and there was minimal upkeep. No council tax payable despite it being an empty home when the occupant is in permanent care. We kept on top of the garden but accept that it was easier as we were local so this would be a cost to factor in. I think for the 5 years my mum was in the home we saved around £80,000 on the council rate bed opposed to the cost it would have been at full rate.

@PoppySaidYesIKnow - now councils are much more on the ball about home ownership. They will place a charge on the property if they find one is owned when they are asked to fund care and according to a solicitor I spoke to can take legal action to recover care costs from the family if they suspect a property has not been declared.

This isn't entirely accurate.

There is an eligibility criteria for deferred payments and if the criteria isn't met the council can use its discretion if they will offer it as an option, but they don't have to. They can also charge interest and an admin fee for arranging it. It's only really an option that can be 'forced' on thenlocal authority if the person has no other funds other than the value of the property and for whatever reason the family are unable to sell then property.

Ditto, someone who has the means to self fund can't actually force the local authority to commission the care on their behalf in order to obtain a cheaper rate. In the past local authorities might have done anyway if asked nicely but due to significant financial pressures are less likely to now due to council funded placements needing to be prioritised for people they can't recoup the money from. Even if they do agree to commission it for a self funder they are likely to charge a high admin fee for doing so.

Self funders are entitled to request a Care Act Assessment to determine if the person would meet the Local Authority threshold for eligibility for residential care.

They can ask for a financial assessment to clarify if the person may be entitled to any financial support in funding their care

They can ask for help from the local authority in sourcing a suitable placement.

In response to the OP - when the cash funds run out you can approach the LA who will first do a Care Act Assessment to establish eligibility for residential care. If the house is still to sell at that point they will offer a deferred payment until it can be sold.

If cash + property has already been used up and eligibility has been agreed then the Local authority will pick up the funding for the placement (minus any ongoing available income from pensions etc) providing the existing home offers placements the local authority rate.

If they don't then the option will be for her to move to somewhere that does accept LA rates or wider family can pay a '3rd party top up' to make up the difference between what the LA will pay and what the care home charges.

There has to be more to this or it was quite a while ago?

Local authorities will usually only agree a deferred payment while a deputyship application is going through the court or there is some complication regarding selling the property. It can't just be used by families wanting to avoid paying higher care home fees and the local authority can charge interest and admin fees on top.

It was something they may have previously been a bit lax on but there just isn't the leeway in council budgets anymore to be nice about these things.

I‘m not arguing with anyone, here is the information about DPAs. https://www.carehome.co.uk/advice/deferred-payment-agreements-to-pay-for-care-home-fees
My mum had less than 23,000 in the bank and all other criteria was met, and therefore the LA did as they were required to do and set up a DPA. My relative had to set up deputyship as mum could not consent. The equity in the house was enough to cover the fees at the point mum passed away. It was set up in 2020 and mum died in 2025. House is now sold and council paid back. Yes there was some interest charged but we still saved around £80,000 by the council then commissioning a bed at the lower rate as they were paying upfront, not my mum.

Well yes - so she met the criteria for a DPA then as I suggested.

You suggested in your initial post that anyone could ask for a DPA and subsequently get their care fees reduced in doing so and that the local authority couldn't refuse this.

I was letting the OP know that this was unlikely to be correct information about her specific situation and probably not going to be an option for her.

FWIW Local Authorities are quite happy to set up DPAs if its needed - it's not something they hide or try to keep secret.

You can check and see if theoretically they accept local authority funding, not all do.

Gently op, it’s always the case that older people transfer to residential care for long, prepare yourself, it varies but that’s my personal experience when very elderly.

She won’t keep attendance allowance once she’s council-funded, and the amount of spending money allowed is pitiful -£30pw I think. So you might expect to support weith that.