Care home prices and funding | Who pays for what?

Care home prices can be expensive and it is easy to get confused when trying to understand how the care system works. It is important you know what support you are entitled to and whether you will need to sell your house to pay for your care home.

Working out how you will pay for a care home can be complicated. It all depends on the value of your assets and where you live in the UK.

Average price of a care home in the UK

Long-term residential care is costly.

Region	Self-funded residential care	Self-funded nursing care	Self-funded residential dementia care	Self-funded dementia nursing care
England	£1,259	£1,540	£1,297	£1,563
Scotland	£1,519	£1,584	£1,551	£1,606
Wales	£1,114	£1,382	£1,182	£1,424
UK average	£1,266	£1,529	£1,306	£1,554

People paying for their own care can expect to pay an average monthly price of £5,064 for a residential care home.

Nursing care is even more expensive with an average monthly price of £6,112.

Location will also affect the prices you pay, with care homes in London and South East England tending to be the priciest. Cheaper care homes are located in areas such as Blackpool, Stoke-on-Trent and Rhyl in Wales.

Once you have been assessed as needing this extra care and support, the next step is to find out how you are going to pay these care home prices

Who will pay your care home fees?

Around a half of care home residents aged 65 and over cover the cost of care home prices themselves and are referred to as self-funders. The other half of older people needing residential care are state-funded and are paid for by the local authority.

Figures from the ONS (Office of National Statistics) show that between 2022-2023, care homes providing care for older people had the highest proportion of self-funders at 49%. Care homes for younger adults had the lowest amount of self-funders at 2%.

South East England had the highest proportion of self-funders at 48%. The North East had the lowest at 26%.

The amount you pay towards your care and how much the state will pay depends on where you live in the UK as well as the value of your savings, investments and your property.

Threshold for care prices

If you are not sure whether you need to pay for your own care, you will need to get a care needs assessment and a financial assessment. These assessments are both done by your local authority and will determine whether you need to contribute anything to your residential care.

• If you live in England and Northern Ireland and you have income and capital over £23,250 you will need to pay for all of your care. If you have between £14,250 and £23,250 you will have to pay some towards your care.

• If you live in Scotland and have income and capital over £35,000 you have to pay your accommodation costs. Everyone in Scotland gets free personal and nursing care (regardless of income and assets) up to a certain limit, if your local authority has assessed you as needing it. If you have less than £21,500 you won’t have to pay anything.

• In Wales, there is just one threshold of £50,000. If you have income and assets above this amount you will have to pay all your residential care costs.

Benefits self-funders can claim in a care home

There are certain benefits you can still claim in a care home. If you are a self-funder, you will still be able to claim your state pension and private pension. There are other benefits you may also be entitled to.

Attendance Allowance

Self-funders aged 65 and over needing care and support will be able to claim Attendance Allowance. This is £72.65 a week. If you need help during the day and night, or if you are terminally ill, you will get £108.55 a week. The amount is paid tax free and is not means tested.

Attendance Allowance isn’t available in Scotland. This because over 65s are entitled to free personal care if they have been assessed as needing it.

FNC and CHC

In England, Wales and Northern Ireland, self-funders may also be able to get help with their nursing care costs, through Funded Nursing Care (FNC) or Continuing Healthcare Funding (CHC). FNC is a flat rate contribution paid directly by the NHS to the care home towards the cost of the nursing care.

In April 2025 FNC in England will increase by 7.7%

The standard weekly rate from April 2025 will be £254.06.

The higher weekly rate from April 2025 will be £349.50.

CHC is not means tested and pays for the cost of a person’s care, their health and social care (personal care) needs as well as their care home accommodation.

Self-funders pay for their care a number of ways. These include selling their home or renting it out. People who sell their home can then pay the price of a care home by investing the money. They can put the money into a high-interest account or buy a care fee annuity.

If you are eligible for state funding, benefits such as a State Pension or a private pension will be used to help pay for the cost of care. However, you will still need an income each week.

Personal Expenses Allowance

You will still get the Personal Expenses Allowance as this is a set amount a person should be left with. In Wales it is called Minimum Income Amount.

This varies according to which part of the UK you live in.

The current rates (per week) for 2025 are:

England: £30.15

Scotland: £34.50

Wales: £43.90

Northern Ireland: £27.19

Top-ups for local authority funded care home residents

If you would like a more expensive care home than that chosen by the local authority, it may still agree to pay for it. This is as long as a third party, such as a family member, friend or charity pays the extra. You, as the resident, cannot pay this extra amount, which is often referred to as a top-up fee.

Here is a video which helps explain who will pay for your care home

Further reading

Below are answers to some frequently asked questions about care home fees that you may find useful.

• Who pays for care home fees when the money runs out? 
• Who is responsible for unpaid care home fees after death?
• Do I have to sell a jointly owned property to pay for care home fees?