LIN Extra Care Annual Conference Paying for care in later life December 8th 2011 John Payne ExtraCare Charitable Trust

What we do Housing with care in villages For anyone – rent, buy, shared ownership, with or without care and support 3500 residents 1500 staff

Vision and Mission Vision Better Lives for Older People Mission To give older people an independent, safe and secure future in a network of inspirational communities

Extra Care housing – Key facts Currently 60- 65% care home residents are state funded Includes previous Owner occupiers who ‘rent accommodation’- in care home 80% of retired people owner occupiers own 1 trillion of housing equity – growing Development has slowed in sector due to lack of capital funding

Leaseholders – Key facts Asset rich – revenue poor 80% of retired people owner occupiers own 1 trillion of housing equity & growing!!! - Older peoples Ave house value =£231,300 v £160,000 Ave – whole population Average pensioner household net income £17576 in 2010 Circa 70%of our leaseholders get assistance with costs – Service charge

Our experience – Funding Care costs Do you worry what will happen in the future if you need care and support? *81% said YES Have you made any financial provision for any future care needs you may have? *81% said NO * ExtraCare research: Nottingham

Facts about care 50% of people aged 65 today can expect to pay £20,000 on care in a lifetime. 25% can expect costs over £50,000 10% can expect costs over £100,000 * Commission on Funding of Care and Support July 2011

Dilnot & beyond White paper? Cap of spending @ £30,000 or £50,000 for care not housing related costs Higher threshold for savings taper relief < £100,000 Likely need for equity release till cap is reached

Dilnot & beyond An alternative view – Increase minimum savings floor to £50,000 rather than current £14,000+ - cheaper! Future generations will have lower housing equity, pensions and higher debts

Extra Care Charitable Trust solution :-

Purpose of today Introduce you to a new concept available to residents at Shenley Wood Village Unique approach following 6 years of research and development Based on research with people like you in other Village areas Addressing the issue of planning and funding your future needs for care and support in later life

Care for Life Created in response to the worries many people have about being dependent on the state to fund their care. 7 out of 10 local authorities rationing support to those with ‘critical’ or ‘substantial’ needs An agreement between you and ExtraCare which ensures you get the care you need, at your home in the Village, for as long as you live. Providing you with independence, security and peace of mind Enabling you to get on with living your life

Example prices Option 1 – Pay in full Age 75 Age 83 Couple Age 75 and 83 OPTION 1 OPTION 2 or 3 + OPTION 2 or OPTION 3 UPFRONT £39,514 £32,392 £57,524 INITIAL PAYMENT £23,708 £19,435 £33,407 NOW & ANNUAL £960 £1,267 £1,781 NOW & IN THE FUTURE £1,129 £1,440 £2,055 Option 1 – Pay in full Option 2 Part payment and an annual premium Option 3 Part payment and an annual payment deferred until surrender of the lease.

Some immediate questions Why a discount for couples? Are any conditions excluded? What if I live for 30 years and inflation means costs have gone up? What happens if you cannot provide the care I need? When can I start benefiting from Care for Life