Around a quarter of people above the age of 65 require some support with everyday living, according to the NHS.
While the number of people who need to move into a care home is smaller, it is still something that you should consider and prepare for – particularly when it comes to cost.
The average fee has spiralled upwards for years and most people will not be eligible for full local authority funding.
This guide will explain how much you can expect to pay for care in Britain, including regional differences, and also run you through the other funding options available.
How much do care homes cost in the UK?
Care home costs have risen sharply – and above inflation – in recent years, according to leading industry analysts LaingBuisson.
According to its most recent report, published in February, the average weekly cost of residential care in Britain was £949. This equates to £49,348 a year.
The average cost of nursing care was £1,267 a week – or £65,884 a year.
Local authorities typically pay less than the average, meaning that self-funders are effectively subsidising those supported by the state. The average cost of a state-funded residential care place was £828, compared to £1,136 for a self-funder.
Care home costs in England
There are noticeable regional differences in how much care costs across the UK.
According to figures from Lottie, a care home comparison website, the average cost of residential care in England was £970 a week, equating to an annual cost of £50,440. Nursing care costs an average of £1,196 a week or £62,192 a year.
Care home costs in Scotland
The average cost of residential care in Scotland was £1,023 a week, or £53,196 a year. Nursing care would set you back an average of £1,197 a week or £62,244 a year.
Care home costs in Wales
Wales was the cheapest for residential care – with the average weekly cost being £955 and average annual cost at £49,660.
Nursing care is more expensive, costing an average of £1,189 a week or £61,828 a year.
What is the care home cost cap?
The care home cost cap has had a long and winding road to adoption.
A proposed cap on care fees was first mooted by Theresa May during her 2017 general election campaign. Dubbed a “dementia tax”, the row around it was blamed as a major reason for the disappointing Conservative result.
However, in 2021, Boris Johnson’s government announced it would be introducing a cap on care fees in England of £86,000 in October 2023. Current prime minister Rishi Sunak delayed this further to October 2025.
When introduced, it will limit the total amount you will have to pay for your own care to £86,000, potentially reducing your lifetime bill and meaning you may not have to sell your home or eat away further into any inheritance you hope to leave your children.
How the upcoming general election will affect this policy remains to be seen.
Will the council pay for care home fees?
The council will usually pay at least some of your care home fees if your assets are worth less than £23,250. This threshold will increase to £100,000 in 2025. This figure includes any savings you have, but also property.
You may still need to make a contribution from any income you might have – for example your pension – as local authority funding rarely covers the full cost of a care home place.
The first step to determining whether you can receive funding is organising a free financial assessment. Contact your local authority to do this. This will determine the level of funding you are entitled to.
You can choose to receive funding directly into your bank account (you will usually need to provide receipts as proof of payment of fees) or have the council pay the care provider directly.
You have the right to choose where you live and the council must provide you with at least one affordable option. If you choose somewhere that costs more than the personal budget given to you by the council, then you can have friends or family pay a top up fee of the difference.
What is the ‘seven-year rule’ for care home fees?
The seven-year rule exists to prevent people from giving their assets away in order to claim funding they should not be entitled to – also known as “deprivation of assets”.
When it comes to assets you’ve given away, perhaps as gifts to friends and family, the local authority will discount any gifts made seven years ago or more when it is deciding if you are eligible for funding.
This is something you should be aware of if you are thinking about giving children or grandchildren any significant gifts in your later years, including any property.
If the local authority thinks you’ve purposely reduced your wealth in order to get funding for a care home, it has the power to investigate and could even take you to court in the most serious cases.
What other funding options are available?
There are some other funding options available for paying care home fees.
If you own your property, and its value has been included in the financial assessment, then you can choose to defer your care home fees. With a deferred payment agreement in place, the council will pay care home fees on your behalf and you can delay repaying them until you choose to sell the home or you die.
This can be particularly helpful if your family still lives in the property. Be aware that the council will take a legal charge on the property and interest will likely be due. In Scotland there is no interest, while Northern Ireland has no formal scheme for deferred payment. You are still encouraged to enquire, however.
Another funding option might be NHS continuing healthcare funding. If you have complex, ongoing healthcare needs, then you might be eligible to have your care costs entirely covered by the NHS.
Contact the NHS to organise a review of your eligibility. Be aware that funding will be reviewed each year and may be withdrawn if your health condition improves.
How do care home costs compare to home care costs?
The average cost of at-home care is less than that of residential care. According to homecare.co.uk, the average cost ranges between £23 and £34 an hour.
Assuming you need two hours of care at home a day, that equates to £420 a week, £1,680 a month or £20,160 a year.
What is included in care home fees?
Your care home fees will usually include your own room, food and other associated residential costs. There will also be care home staff on site to support you if you need help with daily tasks.
Based on your level of need, they may also include any specialist nursing care or support you may need. This is the general difference between a residential care home and a nursing home.
