When a person cannot manage independently and needs someone to care for them, they will have a needs assessment to quantify what help is needed to enable them to stay in their own home. aged care services Following this they will then have a financial assessment which will take any income and savings they have into account. If a person has assets above the regional limits, they must pay for their own care at home and, as help is becoming more difficult to access because local authorities are raising their eligibility criteria, it means that most people are responsible for paying home care out of their income and savings.
Private home care can be expensive so paying for quality care at home may require extra money. This could be achieved by downsizing or equity release. About Downsizing
The most basic way of releasing equity in your home is to downsize your property and buy a smaller home. However, for some, this isn’t feasible due perhaps to the property being in poor repair or that it has already been adapted. It may also be that even if downsizing was possible, the capital released would be insufficient to purchase another, more suitable property let alone having any monies remaining to pay for some care. What is equity release? Equity release is a way of releasing some of the value of your home without you having to move house.
How equity releasecan help pay for care at home
• When you want to stay put in your own home you can release cash from your property to pay for adaptations so that you can remain in your own home. This is a very popular reason for releasing equity. There are many companies specialising in providing facilities designed to increase the independence of disabled people whether young or elderly, but the problem with this equipment is the cost and, when 7 out of 10 applicants currently applying for grants do not qualify, this can be quite a problem and is certainly a barrier to staying put.
• An equity release scheme can help improve your home and make it more suitable for your needs. Some people continue to live in very poor conditions, putting their own lives at risk, in order that someone else can inherit their assets instead of using them for their own benefit. The fact is that older people are much more likely to live in poor housing and are very much more at risk during the winter, especially during times of severe cold. They are also more exposed to risk of death caused by fire and one older person dies every 5 hours due to a fall.
• Equity release can help you remain in your own home by releasing money to help pay for care.People nowadays have an expectation of a standard and quality of life that past generations did not and can use this equity to achieve this aim. Releasing equity is the most straightforward way to access funds that will then be used to pay for any care and support needed to enable you to continue living independently.
A great many older people have the means to improve their living standards and access the care they need if they wish to. According to government research, 78% of older householders own their own home and, as a group, those homeowners over 65 hold 460 billion in equity in their homes. They have a level of equity in their properties that previous generations did not and when in the position of having a home or income inadequate to meet their needs, nearly half are expecting to access equity in their property to rectify the situation.
Before paying for care with equity release consider; • Downsizing, trading down, grants etc? • Have you claimed all of the benefits you are entitled to • Your future needs, objectives and what are your plans for the money released? • Your tax position? • The effect that equity release could have on your eligibility for state benefits • The views of your family • The costs of compounded interest over a long period with some products? • Last but not least, have you taken independent financial advice?
Over time, equity release schemes to pay for care at home is becoming more acceptable. Not only are interest rates starting to come down, but further improvements to equity release plans are ongoing. One of the most practical is a scheme for the elderly with health problems. Older age and adverse health may result preferential terms when calculating the amount that can be released. This is quite ground breaking and very similar to what happened back in the 1990s when the ‘smokers’ annuities were launched. The idea was that, as smokers had a reduced life expectancy due to their lifestyle, it was unfair to give them the same annuity rate as those who did not. This was based on the argument that, statistically the smoker would die first and the monies he had spent buying his annuity cross subsidised that of the non smoker’s, which was unfair.
Smokers and lifestyle annuities are now well established but, with this idea starting to be applied to the level of income a person with health problems can access with equity release, it is likely to make a huge difference to the amount they can raise. More importantly, people applying to use this type of impaired health equity release scheme are the ones who are more likely to need or be in receipt of home care. Enabling care at home using equity release makes quality homecare a much more affordable proposition.
Royal Providence is an expert professional on the topic of elderly home care and senior home care due to to her extensive research and experience in dealing with answering clientelle with the same problems or questions.