Care home chains are in trouble. Demand for places is increasing with longevity and the rising number of cases of dementia, but funding is predominantly dependent on Local Authorities, whose own stretched resources are limiting their ability to pay and leading to their demanding places at below their cost price.

In consequence, care homes are having to look to self-payers to subsidise the cost of providing care to residents who are funded by their Local Authority, and according to a recent report they pay 41% or £236 per week more for living in the same homes.

Financial support from Local Authorities is available to people whose savings and income are less than £23,250. However, a person’s home will be excluded from the means test if a partner or spouse is still living there.

Some homes target self-payers, and these are exacerbating the problem by taking custom away from the homes which cater for both self-payers and Local Authority residents, with the result that these homes are  struggling to survive. A further problem they have is that of attracting staff in the Brexit world and having to pay the minimum National Living Wage which was introduced in 2016.

The problem of rising demand and reducing supply is one which may be addressed by the government in its forthcoming Green Paper on long term care, but there is a strong case for those who are financially able to do so to make provision for their own care, possibly by means of income drawdown from pension plans, releasing equity from their homes, or buying “impaired life” annuities.

For more information, please call or email us today.


The value of investments can go down in value as well as up, so you could get back less than you invest. It is, therefore, recommended that you seek full, personal advice in respect of your needs where all appropriate risks will be explained.