How I intend to fund my Social Care (UK).

I work as a outreach financial assessment officer and one of my roles is to collect income and capital information from service users so that those in the back office can work out how much, if any, of their care that they need to pay.

I typically start the conversation, do you know why I am here? and the purpose of me being here? and the service user would either say yes you’re here to pissing take my money from me or no they do not understand why they said yes for a stranger to come into their living room asking personal questions about their finance. And I always start with, you are currently receiving care at the moment and they would say yes and then I would say well that care that you are receiving is not free.

There would be a silence, I have to give it time to register that Social Care is no the same as the NHS, and the local authority expects some or all of that care to be covered by the service user. The response of the service user is always I didn’t know I have to pay I always thought that it was free. Then they go on about how it’s not fair that the government want to take away their money from them.

Honestly I don’t blame them for being in shock, I was in shock when I was trained up for this job. Social Care is costing the local authority a staggering amount of money. I felt really upset because I pissing scarficed and worked hard for my money.

The typical cost of homecare can range from $60-$300 per week. The most I’ve heard for cost of homecare is $1000 per week. The most expensive care is nursing/residential care you can be looking up to $1000 per week that’s $4000 a month just to keep you in old age.

Normally if you have capital above $23,250 (this amount will change in Oct 2023) then you would have to pay for the full cost of your care yourself. When I look at the numbers I’m like how the hell am I going to afford this. If you also have a high income coming in then you can expect to pay for the care yourself.

The question is how do I intend to look after myself and my imaginary pet hedgehog when I retire, I don’t have a family of my own. And even if I do have family of my own from what I’ve seen from service users I visited they are pretty much living their own lives to be bothering about elderly parents or aunts or whatever. It’s sad how the elderly are marglinsed or side lined as if they are useless. From sitting and talking to them they are a wealth of knowledge and the amazing stories they have locked up it’s better than going to a cinema to see a film.

Still I digress, I need to fund this, I am taking a worse case example in that I need to go into nursing or residential care. If that happened then the local authority would have a charge on my properties and they will wait until I die before they recover their money. And these residential /nursing homes are clever they make sure that you live long enough to cover their costs. Once your money run out you better start calling the undertakers.

On a serious note back in 2011/2012 the average length of stay for a person in a residential care was typically 4 years before they passed away. Around that time BUPA did a similar study with a small sample group and found on average that their patients spend 2 years stay before they pass away!! They recorded that at least 90% of their patients die within the 3 years.

If I am looking at a cost of $4000 per month the worst case scenario I may have to pay $192k or $96k. So if I live for a short period my nieces, nephew and my imaginary pet hedgehog may actually inherit something. Knowing how incrediable lucky I am, I am probably going to be that one person who lives for an extra 30 years just to piss everyone off.

I digress again!!! How am I going to pay for this? How will i fund $4000 per month?

The goal is stablility – but also in line with inflation. I have identified four main areas that needs to be in place by the time of retirement.

The first step is that I must be debt and mortgage free by retirement age.

The second step is that I need to make sure that I qualify for the full state pension. Here in the UK we receive something called a state pension. I would need to contribute 35years of national insurance in order to qualify for the full pension which at the time of writing stands at $9,371.27.

State Pension – $9,371.27. 35 years qualifying. I will need to top this up in order to bring it to $10,000. Maybe ISA shares and investments.

Company Pension – min. $10,000 income pa . I am sure I already have this but I need to look for the various pension pots that I’ve joined and put this under one roof or provider.

Private Pension – $10,000, income pa. I’ve never went down the option of a private pension. Instead I went down the route of owning property. The latter is paying off. I need to make sure that I am mortgage free. When this happens the rental income from a property exceeds $10,000. The problem with rental income is that you can’t always guarantee that the income would come in each month. To over come this at leat a minimum of three properties producing a net income of one thousand pound each will help reach the target.

ISA Cash Reserves – Need to build or have cash reserves at least of $100k. My ass needs to do some serious saving, and drawdown $10k per year, only if and when I enter the residential care. The money should not be used for homecare. I am going to write a clause that will allow me to spend my money on a toyboy.

For now I am not including rental income as this can fluctuate. I am looking for something more stable. If I had a business where I can pull in shares of the profits then that would be a bonus. This should be used to fund homecare. The question which business must I invest in. Maybe atually starting a private pension would be a better option.

I think that the goal is once I’ve paid for the debt including the mortgage then I need to look into paying for my funeral expenses and then how to fund social care. Take care of those areas then it would mean that retirement would be taken care off and all I need to do is have plenty of fun with the toyboy of my choice :).

References:

Social care: Will people still have to sell their homes? – By Tom Edington Published 8 September 2021. https://www.bbc.co.uk/news/58486476

Life expectancy in care homes, England and Wales: 2011 to 2012 – Office for National Statistics

https://www.ons.gov.uk/peoplepopulationandcommunity/birthsdeathsandmarriages/lifeexpectancies/articles/lifeexpectancyincarehomesenglandandwales/2011to2012

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