Care Home Vs Home Care: The Cost of Living Crisis
Recent events at home and worldwide have conspired to whip up the perfect storm of rising costs, especially in the food and energy markets. While the UK only imports around 13% of our total fuel from Russia, disruption to the EU fuel market was felt keenly across the UK throughout months of supply chain disruption and political uncertainty.
Regardless of the ultimate fate of now-embargoed Russian petrol, depleted gas reserves in Europe will remain a looming spectre for years to come. A third of all of the UK’s power generation is accounted for by natural gas, and over 80% of households are heated by mains gas. In 2021, the average annual gas bill was £600, in 2022… £1,100.
Spiralling bills are causing spiking stress even for those on above-average incomes, and the surge in living costs isn’t constrained to the energy market, with household services and food prices leading inflation during many months. The ongoing situation in Ukraine, one of Europe’s largest food producers for many centuries, continues to exert a powerful influence on the cost of grain and cooking oil, pushing up the price of essentials like bread, a problem exacerbated by WTO stockpile limitations.
Towards the end of last year, food inflation soared to a record annual rate of 11.6% with fresh food and staples such as milk, sugar and tea bags particularly affected. Certain key items like eggs and frozen veg have spiked over 27% and Asda’s chief exec. Andy Clarke warned that “there’s nothing we can see in the near term that suggests it’s going to go south of [double-digits]. If anything, it’s going to go up.”
The vast majority of economists echo this bleak prediction: average living standards are not predicted to return even to post-pandemic levels until 2027/8, subsequently remaining well below pre-pandemic levels in real terms for an unpredictable number of years. Finding distraction from this state of affairs bites increasingly hard as the cost of e.g. a meal at a restaurant or simply travelling to an event remains high and continues to grow.
While falling real-terms income places the most pressure on lower-income households, rising prices and the stress they bring are also felt keenly by retirees and others who are living on pensions and savings with few realistic options to directly increase their means. With interest rates continuing to rise, the cost of loans and mortgages rise in accordance. With the cost of running a house at a dramatic real-terms high, there’s rarely been a better time to seek alternative solutions.
All of Signature’s luxury care homes offer a comprehensive, all-inclusive service. Residents needn’t worry about the cost of heating the light, airy apartments we offer in winter nor the price of cooling them in summer. Even as the cost of energy continues to rise, we’re able to keep any price increases well below the rate of inflation, beating the end-user market by a substantial margin. Signature has been one of the most stable providers, with our cost increases being among the lowest in the industry.
As food prices keep climbing and the effect broadens to affect a wider range of goods, we continue to offer a fully-inclusive, top-quality dining experience in collaboration with MasterChef 2016 winner Jane Devonshire, ensuring that we remain at the cutting edge in terms of quality, taste and nutrition. All of our homes offer great choice and variety in this regard, from formal restaurant areas that offer silver service, informal bistros for a laid-back, casual dining experience and cafe areas serving coffee and enticing light bites. When those radiant summer days make it difficult to justify eating inside, we also offer alfresco dining on our pretty sun terraces.
While recreation and distraction become increasingly hard to come by in the face of increased costs at all manner of restaurants and venues, we offer a broad range of engaging activities and events on a weekly calendar, with offerings ranging from creative activities like baking and pottery through visits from dancers, singers and musicians to outings to the theatre, cinema and other venues. Our carefully-planned activities are designed to enhance the physical and mental wellbeing of all our residents based on their specific needs and desires and our in-house activities teams are always on hand to assist, whatever the mobility level.
Signature works with Providence Care to help residents eliminate any concerns they may have over increasing annual costs via the option of a care annuity, a powerful solution for many. This type of annuity pays a regular lifetime income towards care fees and can be secured as an ‘immediate needs annuity’ or deferred for an agreed period.
In both cases these policies are transferable, underwritten, subject to the standard 30-day cooling off period and, assuming your policy pays directly to your care provider, tax-free. Care annuities can also be set to increase annually at a fixed level, or in line with inflation. A care annuity provides not just the peace of mind in knowing that forward-going fees have already been taken care of, but also the flexibility to draw annuity payments as direct income in the event that holders decide on a change of lifestyle, or to pursue other funding solutions.
Many of our residents hold care annuities that cover all of the costs and potential future cost increases of our fees. While annuity-funded all-inclusive care home living is a decidedly simple solution, the offerings of a luxury care home can account for the nuance and complexity of individual needs and desires. This option has the potential to allow residents to eliminate the stresses presented by the spiralling cost of living even against the backdrop of dramatic uncertainty and disruption in those crucial markets which ultimately determine our quality of life.
Signature Senior Lifestyle manages luxury care homes across London and the South East. You can find out more about our homes and arrange a visit here. We can also refer you to a trusted financial advisor to discuss financial options such as care annuity plans.