Care options when you retire abroad
Many people approaching retirement may consider moving overseas presumably to enjoy life as one long, unbroken, summer holiday.
While this is easy to do when you’re in good health, many underestimate the care options available abroad and how to cope with the cost as they get older and their health deteriorates.
At the point where you start to need help looking after yourself, or need to consider residential long-term care, you may face some difficult decisions.
Returning to the UK or staying overseas
You can return to the UK to seek help, but your position will be uncertain.
When you arrive, you will need to prove your intention to settle permanently. Your application must be processed before you’re deemed to have ‘ordinary residence’ – and success is not guaranteed.
Only when you have been classed as being resident, will you be assessed to decide whether you are entitled to state help with medical care.
It means you may need to pay for a stay in a care home while you wait to be assessed. Even then, there’s no guarantee you will receive any assistance from the state.
There are also other issues that make returning to the UK a difficult choice.
If you’re a long-term expat, you face losing your support network.
If you are part of a couple and only one of you requires residential care, it can be more complex, because if you sell up to return, there’s a chance you may not be able to afford to buy in the UK.
On top of that, the half of the couple who is in better health may not want to relocate.
If you stay in your new home country, meanwhile, you need to consider affordability.
The UK Government does not have any reciprocal arrangements to cover overseas residential or nursing care for Brits living abroad, so you cannot turn to the state.
Expats may also struggle to adjust to their new place of residence with only 57% of expats worldwide finding it easy to make new friends abroad, according to InterNations.
There are many reasons why expats can struggle to make friends. They may not have learned the local language, warmed to the cuisine or adapted to cultural differences.
The provision of private care varies enormously between countries too, so expats may not be able to find the kind of care they want. So, it’s important to get to grips with what’s on offer.
Below we’ve explored the care provision in four popular retirement destinations, including France and Spain, and how much it will cost you.
Care options and costs in Spain
In Spain, it’s traditional for elderly people to live with their family; and adult offspring are obligated to provide care for their parents.
This means that historically there hasn’t been much demand for residential care although in the past 10 years, things have gradually changed, and the market is growing.
“Spain has a less developed care home market, largely due to the reliance on informal care,” says Knight Frank in its latest European care homes report.
“But by 2050, Spain will have the second highest share of people over the age of 80 in the world, surpassed only by Japan.”
Luckily for British expats, there have been some homes built specifically with them in mind.
But in the past, British expats have complained about their difficulties in finding anywhere suitable that’s available in their chosen area.
Residential services can vary dramatically, but most have medically trained staff. A doctor tends to visit regularly, and there can be nursing care available 24 hours a day.
At the moment, the cost of residential care in Spain is cheaper than the UK.
Knight Frank says the average cost of residential care in the UK was around £3,350 a month in 2019 although fees can vary depending on the region and care type.
In Spain, fees range from range from €1,800 (£1,544) to €2,200 (£1,888) a month, depending on the region and quality of accommodation.
If more services are required, the costs can be even higher.
It’s also worth considering that expats often have their assets in pounds, and the bills may be in euros, so any declines in the value of the pound will make care more expensive.
Care options and costs in Portugal
As in Spain, when you get old in Portugal, there’s an emphasis on turning to the family. Here too there is an obligation for adult children to care for their parents.
It means that care services have tended to largely consist of organisations providing care within the family home.
The relatively small number of residential care services and increasing demand from an ageing population means prices are comparable to the UK.
According to Algarve Daily News, residential care costs between £2,200 and £4,400 a month, depending on your needs.
The relatively high cost is one reason why illegal care homes are an issue in Portugal, where families take old people into their homes, charging them less, but providing an unregulated service.
Caring for elderly parents at home: costs and considerations
Care options and costs in France
Residential care is far more developed in France than elsewhere in Europe.
There are several options in France, including sheltered accommodation, which offers an interim solution between staying in your own home and moving into a residential care home.
One of the benefits of the French system is that you may be able to receive a payment called the APA to help cover your costs.
But you’ll have to meet some conditions, including needing help with daily activities, living in your own home or at the home of a family member, or at a faculty – and you need to be over the age of 60.
You may need this help, because according to Knight Frank, care is not cheap in France. The average monthly cost of residential care varies from €2,500 (£2,145) to €3,750 (£3,218).
The fees you will pay depends on the region and quality of accommodation.
Care options and costs in Australia
The emphasis in Australia has historically been on care in your home, so there’s a developed network of private carers that expats can take advantage of to remain in their home for longer.
There’s also tended to be a focus on smaller care facilities in the past, but this is changing as over 200,000 Australians live or stay in residential care on any given day, according to The Conversation.
Expats in rural areas outside of major cities may struggle to find what they are looking for locally, although there is plenty of provision in the major cities where expats tend to settle.
In these homes, the costs are broken down into a daily fee, a means-tested care fee and an accommodation fee.
Each home varies in price according to the local market although you can get a good overview of what to expect in fees at Bupa Aged Care.
According to Bupa Aged Care, the daily fee for Clayton is $51.63 (£27.18) and it costs $63.90 (£33.64) per day for a premium room.
There’s also the means-tested care fee, which is capped annually at $27,532.59 (£14,496). Additional care and services can push these costs even higher.
Based on the above estimates and using the worst-case scenario of paying the full means-tested care fee, monthly care costs are around £3,000.
This could be lower as Australians may get some state help, including Brits who have become Australian citizens, but expats on temporary visas can expect to pay significant sums for care.
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Don’t get caught out on care abroad
The lack of state assistance for expats is striking and makes it easy to understand why Brits living abroad might be tempted to move back to the UK.
It’s far more common for people to plan to stay while their health is good and return to the UK when they need more help.
It’s one reason why so many expats do not register as a resident in their new home as they may want to be able to turn back to the NHS.
For those who do intend to stay, it’s vital to consider plans for the ‘third stage of life’ to ensure care needs are not put off too late and there’s not enough money to fund long-term care.