Care fee annuities, also called immediate need annuities or even care home annuities, are very tax efficient investments designed to provide people needing care (or their Powers of Attorney) with either a level, or escalating additional tax free income for the rest of their life. This is then used to pay for care fees wherever care is required – at home or in a care home or nursing home.
Care Fee annuities are also portable, so no matter whether you buy one whilst receiving care at home, it will continue to be paid to any registered care home you may eventually move to.
The real beauty of them is their simplicity and also the peace of mind they provide that money will never run out. As you only ever need to pay one single premium at outset, it also helps cap the future cost of care.
Care Fee Annuities can only be purchased once care is needed (which is why they are often described as Immediate Needs Annuities) and you are over 60. They can be purchased by either yourself or a Power of Attorney acting for you and paid for by paying just one single premium at outset.
In return for paying this premium a care fees annuity can provide you with:-
*The income paid by care annuities is currently only tax free providing it is paid to a registered care provider or home and the benefits requested are not greater than the cost of care. Please be aware tax rules are also liable to change.
However as a care fees annuity is purchased by paying an initial premium they do carry the risk that should you die prematurely and decided not to take the optional extra capital protection, you will receive no refund. This can to some extent be insured against by paying extra and taking the capital protection option. You can read more about capital protected care fee annuities below
Care fee annuities are individually priced based on both the amount of income requested, the options selected and how long the insurer feels they will need to continue paying for. This in turn is based on the individual’s age, medical history and need for care. Therefore it’s impossible to give any meaningful figures here but as specialist and impartial care fee advisers we will be pleased to obtain the very best care fee annuity quotes we can, from ALL providers, free of charge and without any obligation.
The main benefit of a care fees annuity is to ensure care can continue indefinitely but no one can predict just how long care will be required for and should the person it covers, die earlier than expected you could lose money compared to what you have paid. It’s therefore reassuring to know that even if this turns out to be quite short, one immediate needs annuity provider includes free of charge, some limited and decreasing capital protection within the first 6 months which will refund any difference between the amount protected and the income paid, and all providers, offer you the chance to buy longer protection giving you the chance to initially protect either 25%, 50% or 75% of the premium.
You can find out all you need to know about care fee annuities by requesting or downloading a copy of our brochure opposite.
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✓ Impartial Advice - All providers quotes
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Please note: These plans are not offered direct by the insurers
Find out all you need to know about care fee annuities or care plans. Click here.
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Advice on Care is a trading style of Keith Hargraves who is an appointed representative of Quilter Financial Services Limited and Quilter Mortgage Planning Limited, which are authorised and regulated by the Financial Conduct Authority. Quilter Financial Services Limited and Quilter Mortgage Planning Limited are entered on the FCA register (https://www.fca.org.uk/register/) under reference 440703 and 440718.
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