A major concern for those reaching retirement is the cost of entering care in later years, which now is approaching £1,000 per week at some nursing homes.

Fears surround the need to sell property to finance care and having no money left to leave a legacy to children. Care home funding both here and in the United Kingdom is an emotive issue.

Not surprisingly there are many misunderstandings, such as the necessity of selling one’s home and the ease of passing the burden to the state by giving money away before entering care.

The reality is more complex.

Government policy dictates that money cannot be given away to avoid paying for care, however protections are in place which often obviate the need to sell one’s home. Well before there is a need to enter a home it is worth consulting an Independent Financial Adviser (IFA) in order to obtain an overview of the rules, to understand the preparations that can be made and the assistance that the IFA can give once in a home.

In preparation, many people are unaware that an insurance policy can be taken out to pay a fixed sum should entering a care home be necessary.

Should the policy never be called upon, then the premium is not necessarily wasted since the policy converts into a Life Assurance policy.

For those entering care, budgeting is essential in order that funds last as long as possible.

This involves a number of activities which an IFA can help with:

Understanding the allowances that are available, which may include an Attendance Allowance, a Nursing Allowance and an additional tax allowance;

Investing to make monies last as long as possible.

In an environment where interest rates provide negative returns after inflation, there really is little option but to look to alternative investments to increase capital from which funds can be drawn, or to invest in alternatives which can provide higher income; and

Reviewing your budget so that all incomes and expenses can be considered and that there are sufficient liquid investments to pay the care home fees as they become due.

It is important to speak to an IFA to seek assistance and who can help lessen the burden for you.