How Much of Your Savings Will You Lose to Care Home Fees?
In England, council support depends on your assessed needs and finances. Capital at or below £14,250 is ignored, but income may still contribute. Between £14,250 and £23,250, a tariff contribution from capital is also assessed. NHS funding has separate rules.
Last updated: September 2026
This guide explains exactly what that means for your money, with a calculator to show you what you'd actually pay, and answers to the questions families ask most.
The Three Thresholds You Need to Know
In England, every council uses the same financial rules when someone goes into a care home. There are three bands:
Above £23,250: you pay for everything
This is the upper capital limit. If your savings, investments, and included assets add up to more than this, you're classed as a "self-funder." The council won't help with your fees, and you'll pay the care home's full rate, usually £1,000 to £1,800 per week depending on where you live.
Between £14,250 and £23,250: income and capital are assessed
This is the tariff band. You don't pay the full fees, but you contribute assessed income plus £1 weekly for each £250, or part of £250, of capital above £14,250. Council support depends on eligible needs and the agreed budget.
£14,250 or less: capital is ignored
This is the lower capital limit. Your savings are ignored in the capital calculation. If eligible for council support, you may still contribute a portion of your income (pension, benefits) towards the fees.
The thresholds haven't changed in over a decade and aren't adjusted for inflation. That's why more and more families find themselves tipped into the self-funder category over time.
Work Out What You'd Pay
Use the calculator below to see roughly what you'd contribute each week, based on your own savings and income.
Your home is NOT included if your spouse, a relative over 60, or a dependent child still lives there.
This is an estimate based on England's 2026/27 rules. Wales, Scotland, and Northern Ireland have different thresholds. It's not financial advice. Request a financial assessment from your council for your exact figures.
Worked Examples
Three realistic scenarios to show how the numbers play out.
Margaret, 84, with £60,000 in savings and pension £220/week
Margaret is above the upper capital limit, so she's a self-funder. Using a £1,200 weekly fee and all £220 of her pension towards it, the £980 weekly draw would take her savings to £23,250 in about 8.7 months. She should approach the council in advance. If eligible for support, an income contribution and tariff income from capital may still apply.
John, 78, with £18,000 in savings and state pension £180/week
John falls into the tariff band. His £18,000 is £3,750 above the lower limit, which means a tariff income of £15 per week (£3,750 ÷ £250). He contributes £15 plus his pension minus the Personal Expenses Allowance (£31.80/week), giving an illustrative £163.20 weekly contribution before any other income disregards, subject to assessed needs and the agreed budget.
Dorothy, 91, with £8,000 in savings and pension £185/week
Dorothy is below the lower capital limit. Her savings are ignored completely. She contributes her pension minus the Personal Expenses Allowance, giving an illustrative £153.20 weekly contribution before any other income disregards. Council support depends on assessed needs and the agreed budget.
What Counts as Savings and What Doesn't
This is where things get more complex. "Savings" in the financial assessment doesn't just mean money in a current account.
What's counted:
- Cash savings (current accounts, savings accounts, Premium Bonds)
- Investments (stocks, shares, ISAs, unit trusts)
- Property you own but don't live in
- Business assets
- Trust funds, in most cases
- National Savings certificates and bonds
What's not counted:
- The value of personal possessions (furniture, clothing, jewellery for personal use)
- Life insurance policies that haven't matured
- Pre-paid funeral plans
- Some compensation awards
- The surrender value of annuities
Income is separate:
Your pension, benefits, and other regular income are assessed separately from your capital. Most of your income goes towards your fees, but you keep the Personal Expenses Allowance (currently £31.80 per week) for your own use, for things like clothes, toiletries, or phone bills.
What About the House?
For most families this is the big question. The answer depends on who else lives there.
Your home is NOT counted if:
- Your spouse, civil partner, or unmarried partner still lives there
- A relative over 60 lives there
- A relative under 60 who is incapacitated lives there
- A dependent child under 16 lives there
In these cases, the house is disregarded from the financial assessment entirely, no matter what it's worth.
Your home IS counted if none of the above apply.
If the house is included and pushes you over £23,250, you don't have to sell it immediately. You can apply for a Deferred Payment Agreement, where the council pays your fees and recovers them when the house is eventually sold.
What About My Spouse or Partner?
This trips a lot of families up. Your spouse's income and savings are not assessed. Only the person going into care is means-tested.
That said, jointly-held accounts are usually split 50/50 for the purposes of the test, so if you have £40,000 in a joint account, £20,000 counts as yours. The same applies to jointly-owned investments.
Speak to a financial adviser if you're unsure. Age UK's advice line is free: 0800 678 1602.
What the Council Can't Touch
Whatever your means assessment says, the council has to leave you with:
- Personal Expenses Allowance: £31.80 per week for your own use
- Any benefits that don't count as income, for example, the mobility component of Personal Independence Payment
- Assets that aren't counted (see the list above)
If you're a self-funder, you can also claim Attendance Allowance, up to £114.60 per week, to help with care costs. It's not means-tested and many families don't claim it.
A Word of Warning About Giving Money Away
If the council thinks you've deliberately given away savings or property to qualify for help, they can treat you as still having that money. This is called deprivation of assets.
It applies to things like:
- Gifting large sums to family after a care diagnosis
- Selling the house to a relative for below market value
- Spending unusually large amounts in a short period
- Transferring assets into a trust shortly before needing care
There's no fixed time limit on how far back councils can look. It comes down to what the council believes your intent was. Normal spending, reasonable gifts, and long-standing financial arrangements are fine. Moving money around to dodge the assessment is not.
If you're thinking about financial planning around care costs, take proper legal or financial advice first. Getting it wrong is expensive.
Frequently Asked Questions
How much savings can I keep before the council helps with care home fees?
In England, council support depends on needs and financial assessments. For 2026/27, capital at or below £14,250 is ignored, but income may still contribute. Between £14,250 and £23,250, a tariff contribution from capital is also assessed.
Will I have to use all my savings to pay for a care home?
Capital at or below £14,250 is ignored in the England council means test for 2026/27. That does not guarantee a particular placement or cover every expense. Council support depends on eligible needs and a financial assessment, and an income contribution may still apply.
Can my partner's savings be used to pay for my care?
No. Only the person going into care is means-tested. However, jointly-owned savings and assets are usually split 50/50 for the assessment.
Do I have to sell my house to pay for care?
Not always. A property disregard may apply where a spouse, partner or qualifying relative continues living there. If the property is counted, ask whether a deferred payment agreement is available; eligibility and suitable security are required.
What happens when my savings run out?
Contact the council before funds run low to arrange needs and financial assessments. The council must arrange suitable care for eligible needs, but this does not guarantee funding for the existing placement at its current private fee. Ask about the budget, alternatives and any proposed top-up.
What is the Personal Expenses Allowance?
It's an amount the council must leave you from your income, currently £31.80 per week in England. It's for personal spending (clothes, toiletries, haircuts, small gifts) and isn't used towards care fees.
Can I give my savings to my children to avoid care fees?
No, and trying to will likely be classed as deprivation of assets. The council can still treat you as if you had the money, and you'd end up paying the fees anyway. Always take proper financial or legal advice before making any large transfers.
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Find care homes near youThis guide is based on England's 2026/27 rules. Figures are accurate as of April 2026 but may change in future tax years. For your specific situation, request a free financial assessment from your local council's adult social services team.
Funding information checked 19 September 2026
Council and NHS funding rules here refer to England. Other UK nations have different arrangements. Individual eligibility depends on the relevant assessments.
Could the NHS pay for your relative's care home fees?
NHS Continuing Healthcare is free care home funding with no means test and no savings limit. Many families don't know about it. The CHC Family Guide explains exactly how to claim it.
Find out in the CHC Family Guide (£37)Have a question this guide didn't answer?
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Could the NHS pay for your relative's care home fees?
NHS Continuing Healthcare is free care home funding with no means test and no savings limit. Many families don't know about it. The CHC Family Guide explains exactly how to claim it.
Find out in the CHC Family Guide (£37)