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How does the care cap work?

Please note when reading the article below that the Government had planned to introduce a cap on care costs. It was suggested that there would be a cap on the maximum amount of care costs someone has to pay during their lifetime, which would be £72,000 for those of retirement age. However this has been postponed until 2020 at the earliest, and there is no certainty that it will ever come into effect.

Last week's "Digestible Dilnot" looked at the likelihood of our parents needing to spend their hard-earned cash on their own care. This week we turn our attention to looking at what the Government is proposing regarding the £72,000 cap on care, due to be implemented in 2016.

The biggest question is do our parents really only need to make provision of £72,000 for their care? Simply put the answer is a resounding NO. If your parents are in the minority 10% they could still be in for a lot more than the £72,000 bill for their lifetime care. And there are implications for us too as we will almost certainly become involved in administering our parents’ finances, assessing affordability of care and even selling their house where necessary.

As before we have simply visualised the data graphically to look at the answer to these questions:

How does the care cap work
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The proposed cap of £72,000 is significantly better than the situation we have now, as it removes the risk of very high care costs, which in turn does protect our parents' assets. However it is just not as simple or quite as good as it sounds. This week's graphic is the second in our "Digestible Dilnot" series. Next week we will conclude with a detailed look at what the costs of one, two and five years in care could look like.

Find out more

Read the Dilnot report in full

Get more facts at Fullfact.org. These statistics are based on a simulation model from three leading universities (LSE, York and Kent)/ Whilst the statistics are not official this model is quoted by both Andrew Dilnot and Jeremy Hunt, The Secretary of State for Health.

Are you trying to understand what the care cap means for your parents but everything you read just makes you more confused? Are you concerned about funding your parents’ future social care needs? Let us know with a comment below.

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