This Happens More Often Than You Think
At an average cost of £67,000 to £78,000 per year, even substantial savings can be depleted within a few years. Many families who start as self-funders eventually reach the point where the money runs out. It’s stressful, but there are clear rules about what happens next — and your parent should not have to leave their care home.
The Key Threshold: £23,250
When your parent’s capital (savings, investments, and in some cases property) drops to £23,250, they become eligible for council funding. Here’s how it works:
- Above £23,250: Self-funder. You pay the full care home fees.
- Between £14,250 and £23,250: The council contributes, but your parent also pays from their capital at a rate of £1 per week for every £250 above £14,250 (called “tariff income”).
- Below £14,250: Capital is ignored. Your parent pays from income only (pension, benefits), and the council pays the rest.
What to Do When Savings Are Getting Low
Don’t wait until the money has actually run out. Contact your local council’s adult social care team when your parent’s savings drop below about £30,000. The financial assessment and care needs assessment take time to arrange, and you don’t want a gap where nobody is paying.
The council will carry out:
- A care needs assessment to confirm your parent is eligible for council support
- A financial assessment (means test) to determine how much the council will pay and how much your parent contributes
Will They Have to Move?
This is the biggest fear families have, and the answer is: not necessarily, but it depends.
The council has a set rate it pays for care — called the “usual cost” — and this is often lower than what self-funders pay. If the care home’s fees are higher than the council’s rate, there are two options:
- The care home accepts the council rate: Some homes will reduce their fees to the council rate rather than lose a resident. This is worth negotiating.
- Third-party top-up: A family member can pay the difference between the council rate and the home’s actual fees. The council pays its contribution, and you pay the “top-up” directly to the care home.
If neither option works and the home won’t accept the council rate, then yes, your parent may need to move to a home that does accept council-funded residents. The council must help find a suitable alternative.
Top-Up Fees: What You Need to Know
If you agree to pay a top-up, be aware:
- Top-ups can increase annually — ask the care home about their fee increase policy
- You’re entering a legal agreement. If you stop paying, the care home may ask your parent to move
- The top-up amount can be significant — sometimes £200-£500+ per week
- Consider whether this is sustainable long-term before committing
The “Self-Funder to Council” Transition
Be prepared for the reality that self-funders often pay more than council-funded residents in the same care home. This feels unfair, and frankly it is — but it’s how the system works. The important thing is to plan for the transition rather than being caught off-guard.
Key Steps
- Monitor your parent’s savings — keep track of the £23,250 threshold
- Contact the council well before savings run out (at around £30,000)
- Request care needs and financial assessments
- Talk to the care home about whether they’ll accept the council rate
- Consider whether top-up fees are affordable and sustainable
- Look into whether your parent qualifies for Attendance Allowance or NHS Continuing Healthcare
If you need to explore alternative care homes that accept council-funded residents, CareFinder can help you compare options in your area.