The reality of paying for elderly care

Whether you’re concerned about the prospect of paying for your own care as you get older or looking into the costs of elderly care for a relative or loved one, some of the figures involved can be daunting.

Our recent data analysis shows that UK homeowners could lose around 50% of the value of their property if paying for residential care for an average stay of four years. This can depend on the area of the country and could easily mount up to between £113k - £161k.

In this article, we look at various aspects of the cost of elderly care, including options such as residential care, in-home care, family members as carers and other alternatives that might potentially delay the need for costly high-level care.

Jump to:

• Average care home costs
• The cost of elderly care at home
• What is the social care cap and why has it been delayed?
• The cost of family members as carers
• Is there any support available for family members who are acting as unpaid carers?
• Elderly alert devices to potentially reduce or delay care costs
• Are personal alarms expensive to run?
• How personal alarms help elderly people stay independent for longer

Average care home costs

There are many reasons why an elderly person may need to move into a care home. They may need someone around 24/7 to assist if they require a high level of care for medical conditions or need significant help with managing daily activities, such as washing, dressing, and moving around.

Those with advanced conditions such as dementia or Alzheimer’s might also require residential care to help ensure their safety.

Care home costs can vary, depending on the level of care required and the area of the UK in which you live, but our research has found that it will usually fall somewhere between £113k-£161k for an average stay of four years in residential care.

In 2022, TakingCare Personal Alarms analysed how care home costs vary in different areas of the UK, as well how the quality of care and number of providers available varies depending on where you live. Our data found that care home costs vary dramatically throughout the UK.

Table demonstrating the different care home costs in regions in the UK

With the cost of living crisis putting pressure on care homes and consumers’ ability to save for the future, the data highlights how more needs to be done to address the needs of an increasingly ageing population.

To see the full breakdown of the towns and cities we evaluated and see how your hometown stacks up, access the full report here.

How can I pay for care home fees

The cost of care home fees is currently self-funded by individuals if their total capital (i.e. their savings, investments, and property value) is worth more than £23,250. There is a sliding scale of funding support available for those with capital underneath this amount.

For many people, whether they receive any funding support or not, this can mean that their home is sold to pay for their care.

More than a third (36.7%) of Brits are expected to have to use the value of their home to pay for care in later life. This means that homeowners could lose as much as 56% of the value of their home to supplement their care home costs, despite increasing property prices.

ONS data reveals care home residents typically spend at least four years in care homes, costing individuals on average £113,000- £161,000 depending on where they live in the UK. For 12 of the UK’s top 20 cities, including Manchester, Nottingham, Liverpool and Derby, the data found that this cost was more than 50% of the average house price in the area.

In the UK, first time buyers typically save for eight years to raise enough money for a house deposit - but just one year of care home fees costs more than the average house deposit.

Areas of the UK that have cheaper house prices, such as the North of England, risk losing the most capital from their property to pay for care home costs.

The table below compares average house prices in 2022 in areas of the UK that have the cheapest housing, with average cost of care homes in the local area to assess how much money home owners will lose from their properties to pay for care. House price data has been taken from Rightmove.

Table demonstrating how much money home owners may need to use from their properties to pay for their care home costs in the UK

There are set to be changes to the way this system works and the various thresholds in 2025, but elderly people, or their relatives, will still be expected to contribute a significant sum to their care home costs.

The cost of elderly care at home

If you or an elderly loved one don’t need residential care but do still need assistance at home with daily living tasks, there is also an associated cost.

Again, there is a sliding scale of funding support available from your local authority if your total capital is under the current threshold of £23,250, but this doesn’t take into account the property value if it isn’t residential care that is needed. Regular income is also means-tested for this type of funding support.

The cost of elderly care at home will depend on the level of support needed but is usually charged at an hourly rate by the provider. For example, if you or an older relative needed two home care visits per day, this could easily equate to a daily cost of at least £30-£60, depending on location.

Over the course of a year, this would add up to around £11,000-£22,000. Those with needs that require more home care assistance would need to pay more for a higher level of care to be provided.

What is the social care cap and why has it been delayed?

On 7 September 2021, the government set out its new plan for adult social care reform in England. The reform, which was due to come into place in October 2023, included a lifetime cap on the amount anyone in England will need to spend on their personal care, alongside a more generous means-test for local authority financial support.

The cap on social care would ensure that no individual will pay more than £86,000 towards care costs. The reform would also raise the financial threshold at which people can access funding support from the current £23,250 threshold to offer support to those with capital of less than £1000,000.

However, the 2022 Autumn Statement included a disappointing announcement from Chancellor Jeremy Hunt, who has delayed the introduction of the social care cap until 2025. This means the proposed £86,000 limit on how much money older people will pay towards care costs will be paused until 2025, along with the increased threshold for when they can claim funding support.

The delay could also cause a catastrophic butterfly effect for older people, as those with assets under £100,000 could see their savings slashed to pay for rising care costs.

Commenting on the social care cap delay and what this means for elderly people, Louise Yasities, Elderly Care Expert from TakingCare Personal Alarms, said:

“The Chancellor’s announcement on the delay to the social care cap simply kicks the UK’s care crisis into the long grass and will only serve to increase pressures on the NHS. The decision to delay the cap on social care leaves the UK’s elderly population out in the cold, and many with no other option but to sell their homes to pay for care, which grows more and more costly by the year.

“When the cap was originally announced, older people were set to pay no more than £86,000 on care for people in England, so it’ll come as a disappointment to many that this will no longer happen. Unfortunately, our older loved ones now face a continuation of inadequate care, with the added pressure of disastrous care costs."

“Although NHS funding is secure and the initial extra £2.8 billion promised for social care is positive news, carers and patients need urgent clarity on where this money will be spent in real terms. As it stands, patients will be spending longer times in hospital beds unnecessarily."

“It’s also likely, and even more disappointing, that this will cause delays to ambulance response times, meaning older people will be kept waiting even longer before receiving emergency care."

“It would be good to see the Government acknowledge the potential of working with Local Authorities to invest in preventative solutions and bespoke care packages, leveraging technology-based care solution to help elderly people remain independent in their homes for longer. With an ageing population, creating ways for older people to live happily and gain value from their lives should be a top priority.”

The cost of family members as carers

It’s estimated that around 26% of UK adults are providing unpaid care to an older, disabled or ill relative or friend. It’s incredibly common for family members to provide care for their loved ones as they get older. This could be a spouse, an adult child or another relative.

Caring for an elderly loved one can be really challenging, especially when juggling between other life and work commitments, and there is an emotional cost that needs to be considered, even if there isn’t a financial cost. Carers UK found in a survey that six out of ten carers felt that their own physical health had worsened because of caring for their loved ones, and seven out of ten said their mental health had suffered. Carers need care too.

The video below tells Nicky’s story as she struggled to care for her ageing father, Ken, whilst trying to balance her family and work commitments.

Is there any support available for family members who are acting as unpaid carers?

Alongside carers who work in registered care homes or in the community, there are around 10.6m people in the UK who support vulnerable elderly friends and relatives who need additional support. Often, these carers are unpaid for the work they do and juggle care responsibilities alongside full-time jobs.

If you or a loved one is performing care duties for a family member or friends, then you are entitled to certain benefits. Unpaid carers can claim Carer’s Allowance, set at just £69.70 per week if they care for someone for at least 35 hours per week. However, carers are ineligible if they are in full-time education or study for more than 21 hours per week, earn more than £128 per week or who spend less than 35 hours on their caring responsibilities.

The 2022 Autumn Statement confirmed that Carer’s Allowance is set to rise from £69.70 per week to £75.74 (around £302 per month) with carers also set to receive a mean-test cost of living payment of up to £900. But for unpaid carers of friends or family, many will not be eligible to claim this additional benefit.

As more and more unpaid carers, particularly those in the so-called sandwich generation, are increasingly feeling the bite from the rising cost of living, unaffordable care home costs and a bleak winter for older, vulnerable people, it’s crucial to understand the benefits they may be eligible to claim.

For more information, check out our guide on Carer’s Rights in the UK.

Elderly alert devices to potentially reduce or delay care costs

If you or your loved one currently require a high level of care or daily living support, it might be that residential or in-home care is the best option.

However, if you are at the stage where you’re considering potential care options for the future, there might be some options that could help to reduce or delay some of the kinds of care costs that we’ve already mentioned.

Many older people want to stay in their own home for as long as possible, but concerns about safety when living independently can make this challenging for them and their loved ones.

When considering care home fees, especially with optional added expenses (often called ‘top-up fees’) for things like bigger rooms or extra services, the costs can quickly mount up.

Fully monitored personal alarms for the elderly are available for a small fraction of these costs, either with a monthly fee on or an annual plan and can be set up with no additional or hidden charges. In return, the older person and their family get the peace of mind brought by knowing that there is 24/7 support available in any kind of emergency.

Personal alarms are easy to use, with just a single push of a button needed for help to be at hand, which is why they are so reassuring for elderly people and their loved ones.

Are personal alarms expensive to run?

In light of the cost of living crisis, studies show that many vulnerable households are switching off devices to save on energy costs.

Personal alarms are essential safety devices that help keep vulnerable people safe. They are also inexpensive to run.

Our calculations show that the projected average annual cost of keeping an alarm unit plugged in for a year following the government’s two-year energy price guarantee is just £3.08 - a monthly cost of only 26 pence.

When compared to the costs of other household electrical items, the running cost of a life-saving piece of technology like a personal fall alarm is minimal.

Commenting on the importance of keeping personal alarms switched on, Louise Yasities, from TakingCare Personal Alarms said:

“The elderly population will feel the sting of the rising cost of living and energy bills, particularly those who only receive their state pension."

“While we understand many older people will be taking steps to reduce energy consumption in the home to keep costs down, it is vital they do not forfeit their personal alarm units in a bid to preserve cash."

“Personal fall alarm pendants and other wearables can be a vital lifeline for vulnerable older adults, connecting them to help in case of emergency and ensuring their general wellbeing. Not having access to this support could place them even more at risk, especially during the colder, winter months when falls are increasingly likely."

“The cost of keeping these units plugged in is less than 40 pence per month but are worth their weight in gold when an older person needs access to help."

More information from our analysis can be found here.

Personal alarms help elderly people stay independent for longer

A personal alarm service can make a big difference to some people when it comes to living independently for longer.

Depending on the system you choose, personal alarms cannot only raise an alert if something happens. Some of the technology can even be used to help prevent incidents from happening in the first place and there are various solutions that are suited to a range of different situations, all available for much less than the cost of in-person care.

For example, non-intrusive elderly monitoring devices that use artificial intelligence (AI), can be placed in the home of someone who is living independently but perhaps has regular visits from family or carers. The devices ‘learn’ the individual’s routines and what is ‘normal’, so can then raise an alert if something changes or if usual habits are not observed. In some cases, this can help to pre-empt problems before they develop and give the loved ones early warning that some additional support might be needed, as well as being there if there is an emergency.

On the other hand, if the older person is very active and spends lots of time outside of their home, an elderly GPS tracker that send a location along with an alert if something happens can be a great solution. As they can be used anywhere in the UK, these GPS personal alarms are ideally suited to those who want full independence as they go about their day, but just a little extra reassurance that help is there if needed.

For someone who perhaps has a history of falls, or who is having some balance problems and would like some peace of mind, fall alarms are one solution that could provide just that. With the technology built-in that can detect when someone has a fall and automatically raise the alarm, this can bring real reassurance that help is ready and available if needed.

Falls are the main reason that older people attend A&E in the UK and can often be an event that leads to the development of additional care requirements. Any technology that can help reduce the risk of a fall can be beneficial and perhaps help a loved one to stay living in their own home and maintain independence for longer.