Using An Immediate Needs Annuity To Cover The Cost Of Long Term Care

You might have heard on the news recently that the government are looking into the cost of long term care and potentially putting a cap on the amount that you have to pay yourself with the state covering the remainder. The current system is quite complex as to how much the state will cover and how much you have to fund yourself so a revamp is definitely welcome.

 

So How Much Is Long Term Care?

The figure they are discussing as the maximum you would have to fund is £35000. This is still a sizeable sum so looking after an elderly relative or loved one can be a worrying and financially difficult time for anyone. Nursing home fees can total £500 a week to cover the cost of the long term and constant care of the elderly person in the nursing home.

 

How The Immediate Needs Annuity Can Help

However, with an immediate life annuity, there is no need to be worried about being able to maintain your share of the weekly or monthly payments. This is because when buying this type of annuity you are guaranteed to have the person’s nursing home fees paid for however long they are needed and can be paid direct to the nursing home meaning after the initial setup, you no longer need to manage things and can focus on supporting your loved one.

The immediate needs annuity is purchased with a lump sum of money. The money can be accumulated by selling equity in a property, usually that of the person going into care, or by selling the property completely. This can feel like a difficult decision for any family to make, but the benefits of having long term care paid for can sometimes far outweigh this decision.

 

A Word From A Family In Kent

One family in Kent said, “We were getting very worried at the cost of the nursing home. The bills were getting larger every week and I couldn’t afford to pay my own mortgage! Finding out about the immediate needs annuity helped my family pay for my mother’s nursing care every single week. After the initial lump sum was paid, there was no need to worry again about our financial difficulties and the care fees were settled. Our mother will be in the home for the rest of her life, so this looks like the best option for us and we would advise anyone in similar positions to consider doing the same.”    

 

Get Professional Advice

There are many other types of annuity which you may wish to purchase, and to find the one that is right for you, speaking to an annuity adviser may help. This is because these advisers are professionally qualified and have experience in dealing with annuities and financial planning and will know the market inside out.

They can anticipate rises and falls in the industry which you may be advised to take advantage of. Whatever you choose to opt for, make sure your decision is well informed as you cannot change your mind after signing the papers! This freedom to shop around is known as the open market option.