The decision to move a loved one into a care home is rarely easy. It is often an emotional step, prompted by health needs or the simple reality that living independently has become too difficult. Alongside the emotional weight comes the practical challenge of funding care, and this is where the connection between care home fees and your will becomes particularly important. Understanding how these two areas interact can help you protect your assets, plan for the future, and ensure that your wishes are carried out in the way you intend.
Understanding Care Home Fees in the UK
Care homes in the UK provide either residential care, nursing care, or a combination of both. The cost can vary significantly depending on location, facilities, and the level of care required. For many families, fees can be one of the largest expenses faced in later life, often exceeding the cost of a mortgage or rent. It is not uncommon for care home fees to reach hundreds or even thousands of pounds each month, which means they can quickly deplete savings and other assets.
Local councils carry out financial assessments to determine how much, if anything, they will contribute towards care home costs. In England, if an individual has assets above a certain threshold — currently £23,250 — they will be expected to pay the full cost of their care. Scotland, Wales, and Northern Ireland have their own rules, but the principle is similar: the more assets you have, the more likely you are to be self-funding your care.
The challenge for many is that these fees can have a direct impact on the inheritance they had planned to leave to family members or other beneficiaries in their will. Without forward planning, years of savings, investments, and even the family home may need to be used to pay for care.
How Care Home Fees Can Affect Your Estate
When care home fees are funded from personal assets, they reduce the value of your estate. This means that by the time your will is read, the inheritance you had planned could be far smaller than anticipated. In some cases, it may even be non-existent if care has been required for many years.
This is why estate planning is so closely linked with care planning. Decisions about how assets are owned, how they are managed, and how they are passed on can all influence the eventual size of your estate. For example, if the family home is solely in the name of the person moving into a care home, it may be included in the financial assessment and could need to be sold to fund care costs. However, if it is jointly owned and the other owner remains living there, it is generally excluded from the assessment.
Careful planning can sometimes help protect assets from being completely eroded by care costs, though it is important to act early. Leaving decisions too late, or making certain changes when care is already needed, can lead to accusations of deliberate deprivation of assets, where it appears you have intentionally tried to avoid paying care fees.
Reviewing and Updating Your Will
If you or a loved one is considering moving into a care home, it is vital to review your will. The provisions you made years earlier may no longer make sense in light of your current circumstances. For example, you may need to rethink how you leave your home if there is a possibility it will be sold to fund care.
Updating your will can also ensure that specific gifts are realistic and achievable. If you leave a set sum of money to a beneficiary, but your estate has been reduced by care costs, you may unintentionally disadvantage other beneficiaries. A solicitor can help you reword your will to account for these possibilities, often by leaving percentages rather than fixed amounts.
It’s also worth considering the appointment of executors carefully. Executors will be responsible for managing your estate after your death, which may involve dealing with assets that have been affected by care costs. Choosing someone you trust, and who understands your wishes, is key.
The Role of Trusts in Protecting Assets
Trusts can sometimes be used as part of an estate planning strategy to help protect assets from being lost entirely to care home fees. A trust allows you to place certain assets under the control of trustees, rather than owning them outright. Depending on the type of trust, this can mean those assets are not counted in the financial assessment for care.
However, trusts are not a magic solution and must be used carefully. Setting up a trust when you are already in need of care, or when it is clear you will soon require it, could be challenged as deliberate deprivation of assets. The timing and type of trust are critical, and legal advice is essential before taking this step.
Trusts can also be useful for ensuring that a surviving spouse or partner is able to live in the family home, while still guaranteeing that the property eventually passes to children or other beneficiaries. This can be particularly helpful if only one person in a couple needs care and the other wishes to remain in the home.
Involving Family in the Conversation
Conversations about care home fees and wills can be sensitive, but involving family early on is often beneficial. This helps to manage expectations and ensures that everyone understands the potential financial implications of care. It also provides an opportunity to discuss your wishes openly, so there are fewer surprises later.
Having these discussions while you are still able to make decisions gives you control and allows your family to plan alongside you. This might involve deciding whether to downsize, how to use investments, or how to structure ownership of property to ensure the best outcome for both care funding and inheritance planning.
Legal Advice and Financial Planning
The connection between care home fees and your will is complex, and both legal and financial advice can make a significant difference. A solicitor experienced in wills and estate planning can ensure your will reflects your current wishes while also considering potential care costs. Similarly, a financial adviser can help you explore options for funding care, such as investment strategies, insurance policies, or equity release.
One area that families sometimes overlook is probate house insurance. If a property is left empty after someone moves into a care home or passes away, standard home insurance may no longer provide adequate cover. Probate house insurance is designed to protect an unoccupied property during the probate process, which can be vital for safeguarding the value of your estate. Without it, the property could be at risk from damage, vandalism, or other losses that might reduce its eventual sale price and therefore the inheritance available.
Planning Ahead to Reduce Stress
The earlier you start planning, the more options you will have. If you wait until care is urgently needed, decisions may need to be made quickly and under stress, which can limit your choices. Early planning allows you to structure your finances, consider insurance options, and update your will in a calm, considered way.
This forward planning is not only about protecting assets; it is also about ensuring your care needs are met in the way you want. By taking control now, you can make decisions that balance your quality of life with your desire to leave something behind for your loved ones.
Balancing Care Needs with Inheritance Wishes
It’s important to remember that your primary goal in planning for care should be to ensure you or your loved one receives the right level of support. While preserving assets is often a priority, it should not come at the expense of quality care. Finding the right balance between funding care and leaving an inheritance can be challenging, but with the right advice, it is possible to achieve both.
Some families choose to ring-fence certain assets for inheritance purposes, while using others to fund care. Others may accept that the estate will be significantly reduced, but focus on ensuring the remaining assets are distributed according to their wishes. Whatever approach you take, having a clear plan set out in your will and supported by sound legal advice will give you and your family peace of mind.
The Emotional Side of Planning
The financial and legal aspects of care home fees and wills are only part of the picture. There is also an emotional side that cannot be ignored. Moving into a care home often represents a major life change, and the thought of selling a family home or using lifelong savings to pay for care can be difficult to accept.
This is where having your affairs in order can provide comfort. Knowing that you have planned for the future, taken steps to protect your estate, and made clear provisions in your will can ease some of the stress during an otherwise challenging time. It also helps your family by reducing the uncertainty and potential conflict that can arise when financial decisions are left unclear.
Taking the First Step
For many, the first step is to speak with a solicitor who specialises in wills and estate planning. They can help you understand how care home fees might affect your estate and what options are available to you. From there, you can decide whether to update your will, set up a trust, adjust your property ownership, or explore financial products designed to help with care costs.
It is also worth reviewing your insurance arrangements, especially if you own property that could become unoccupied. Ensuring you have the right cover, such as probate house insurance, can protect the value of one of your most significant assets.
Final Thoughts
Care home fees and wills are two areas of life planning that are deeply connected. Without proper preparation, the cost of care can have a dramatic impact on the inheritance you are able to leave. By understanding the rules around care funding, reviewing your will, considering trusts, and exploring insurance options, you can create a plan that supports both your care needs and your legacy.
While these conversations can be difficult, they are an important part of planning for the future. The earlier you start, the more options you will have, and the greater your ability to protect the things that matter most — your wellbeing, your wishes, and your family’s financial security.