How to pay for a care home
If you are arranging care for a relative, or for yourself, the first worry is usually how it will be paid for. This guide sets out the main routes in plain English.
There are four main ways a UK care home is paid for: paying privately as a self-funder, getting help from your local council after a financial assessment, NHS funding where there is a health need, and care-fee plans such as an immediate needs annuity or equity release. Which applies to you depends on your savings, your income, whether you own a home and your health needs. Many people use a combination, and the right mix is worth getting advice on before you commit.
At a glance
- Main routesSelf-funding, council, NHS, care-fee plans
- Council help triggers atCapital below 23,250 pounds (England, 2025/26)
- Full council help below14,250 pounds (England, 2025/26)
- NHS routesContinuing Healthcare and Funded Nursing Care
- Who assesses youYour local council and, for health, the NHS
- Get adviceAn FCA-authorised care-fees adviser for funded plans
Who pays for a care home?
Nobody is left without care because they cannot pay, but who pays depends on your finances and your health. In England, if your capital is above the upper limit of 23,250 pounds for 2025/26 you are usually expected to pay your own fees as a self-funder. Below that, your local council may help, and below the lower limit of 14,250 pounds it helps the most. Separately, the NHS pays in full for some people whose needs are mainly about health rather than personal care.
This guide is for families and individuals paying care fees. It is not about buying a care home as a business. The figures here are for England; Scotland, Wales and Northern Ireland have their own rules and thresholds.
The four main funding routes
| Route | Who it suits | How it works |
|---|---|---|
| Self-funding | People above the capital limit | You pay the home's fees yourself from savings, income or property |
| Local-authority help | People below the capital limit | The council assesses your needs and finances and contributes to fees |
| NHS funding | People with a health need | Continuing Healthcare or Funded Nursing Care pays some or all of the cost |
| Care-fee plans | Self-funders wanting certainty | Regulated products such as an immediate needs annuity or equity release |
Most people end up using more than one route. A self-funder might claim Attendance Allowance to help with the cost, or buy an annuity to cap the bill. Someone with savings just above the limit might self-fund for a while and then move onto council support once their capital falls toward the threshold.
Self-funding your care
If you are above the capital limit you arrange and pay for care yourself. The risk many families worry about is running money down over a long stay, because there is no fixed limit on how long care lasts. Options to manage that include claiming the benefits you are entitled to, such as Attendance Allowance, and looking at a care-fee payment plan that turns a lump sum into a guaranteed income toward fees for life.
- Pay from savings, investments and income such as pensions
- Claim Attendance Allowance, which is not means-tested
- Consider an immediate needs annuity to cap the fee bill
- Consider a deferred payment agreement if most of your wealth is in your home
Help from your local council
If your capital is below the upper limit, ask your local council for a care needs assessment and then a financial assessment, known as the means test. The council looks at your savings, income and, in some cases, the value of your home. If you qualify, it contributes to your fees, though you usually still pay something from your income such as your pension. The council also sets the rate it will pay, which can be lower than a home's private fee, so families sometimes pay a top-up.
NHS funding and where to get advice
If care needs are mainly about health, the NHS may pay. NHS Continuing Healthcare can cover the full cost for people with a primary health need, and NHS-funded Nursing Care is a flat weekly contribution toward the nursing element in a nursing home. Both are worth asking about, because they are not means-tested.
Care-fee plans such as immediate needs annuities and equity release are regulated by the Financial Conduct Authority. We provide information here and can refer you to an FCA-authorised care-fees specialist. We do not give regulated advice, and you should speak to an authorised adviser before buying any funded product. For council funding and assessments, speak to your local authority.
How to pay for a care home: common questions
Who pays for care home fees?
You pay yourself if your capital is above the upper limit of 23,250 pounds (England, 2025/26). Below that, your local council may contribute after a financial assessment. The NHS pays where there is a primary health need. Many people use a combination of these routes.
How much money can you have before paying for a care home?
In England for 2025/26, if your capital is above 23,250 pounds you usually pay your own fees. Below that the council may help, and below 14,250 pounds it helps the most. Scotland, Wales and Northern Ireland set their own limits.
Can the NHS pay for a care home?
Yes, in some cases. NHS Continuing Healthcare can pay the full cost for people whose needs are mainly about health, and NHS-funded Nursing Care pays a flat weekly amount toward nursing in a nursing home. Both are free and not means-tested.
Do you have to pay for care if you have savings?
If your capital is above the upper limit you are usually expected to pay your own fees. As your capital falls toward the lower limit, council support increases. Claiming benefits such as Attendance Allowance can help whatever your savings.
Where can I get advice on paying for care?
For council funding, contact your local authority for a needs and financial assessment. For regulated products such as annuities or equity release, speak to an FCA-authorised care-fees adviser. We provide information and can refer you to an authorised specialist, but we do not give regulated advice.
Need help with your own situation?
We can introduce you to an FCA-authorised care funding specialist who will look at your circumstances and the options.