Understanding the various sources of private funding for home care is essential when considering care for a loved one. With the right financial strategy, families can ensure their loved ones receive the quality care they need without compromising their financial stability.

In this guide, we will explore different private funding sources for home care, including savings and pensions, family contributions, and financial planning.

1. Using Savings and Pensions

Personal Savings

Many families use savings as a starting point when paying for home care. This private funding source allows quick access to money, which can be especially helpful in urgent care situations.

If you’re still in the early stages of planning for future care for yourself or your loved ones, setting money aside in advance can ease financial pressure later.

Pensions

Pensions are a significant source of funding for many retirees needing home care. They offer a steady income stream, which can be allocated towards care costs.

State Pension – Offers basic support. It’s a helpful supplement but may not cover everything.

Private/Workplace Pensions – These often provide more income and can cover regular care services.

2. Unlocking Home Value: Equity Release

If your loved one owns their home, equity release allows them to access a portion of its value without needing to move out.

Two potential methods to release equity could include:

• Lifetime Mortgage – A popular form of equity release where a loan is secured against your home. You retain ownership, and the loan is repaid when the home is sold.
• Home Reversion Plan – You sell part or all of your home in exchange for a lump sum or regular payments while retaining the right to live in the property rent-free.

Important: Always speak to a financial adviser before making any decisions about equity release. It’s a big step and not right for everyone.

3. Support from Family

Family Contributions

Family members often come together to support their loved one’s care needs. This support can take the form of regular financial contributions or one-off payments.

• Pooling money – Siblings and other relatives can pool their resources to share the financial burden, making it more manageable for everyone involved.
• Flexible arrangements—One benefit of this type of funding is that family contributions can be adjusted based on each member’s changing care needs and financial situations.

Providing Care Yourself

In some cases, family members provide care themselves, reducing the need for paid services.

• Save on costs—Informal caregiving can significantly reduce home care costs, though it may require adjustments in the caregiver’s work and personal life.
• Emotional benefits – Being cared for by someone familiar can bring comfort and stability.

Remember, caring for a loved one is a big responsibility—don’t be afraid to ask for help when you need it.

4. Planning Ahead for Long-Term Care

Long-Term Care Insurance

Although long-term care insurance is no longer available through mainstream insurance providers in the UK, it was initially designed to cover the costs of care services, including home care.

Historically, there were two types of long-term care insurance policies: immediate care plans and pre-funded care plans.

Investments

Investing in stocks, bonds, or mutual funds can help grow your savings over time, providing another source of private funding for home care. Of course, there are several investment strategies that you could adopt, and consulting with a financial advisor can help tailor a plan suitable for financing your future care needs.

Trusts & Wills

Setting up a trust or updating a will can help make sure funds are protected and used for care.

• Trusts – Trusts can protect assets from being depleted too quickly and ensure they are used according to your wishes.
• Wills – Clear instructions in a will can help manage the distribution of assets, ensuring that care needs are prioritised.

5. Other Helpful Options

Charitable Grants

Some charities offer small grants for care costs, equipment, or home adaptations. It may not cover everything, but every bit helps.

Personal Health Budgets

The NHS may offer a personal health budget for those with long-term health needs. This can sometimes be topped up with private funds for extra support at home.

You’re Not Alone—And You Don’t Have to Do This Alone

Sorting out care funding can feel overwhelming—but remember, you’re doing this out of love. And there are plenty of ways to make home care affordable and sustainable.

Every family is different, and there’s no one-size-fits-all solution. What matters most is finding what works best for your loved one—and for you.

Talk to Someone Who Understands

At Premier Community, we’ve been helping families for over 28 years. We know how emotional and complicated this journey can be. Whether you need help understanding your options or want to build a care plan that fits your budget, we’re here for you.

Let’s work together to give your loved one the comfort and care they deserve—without the financial stress.