If your local authority agrees to help you pay for care, they’ll decide a personal budget that covers the care needs they’ve identified.

For residential care in a home, this is sometimes called the ‘usual cost’ and your local authority must make sure that at least one care home has availability to meet your needs within the budget they set.


If you’re granted funding for care, your local authority should give you a written breakdown of how much they’ll contribute and how much you’ll be expected to pay. This total figure is your ‘personal budget’, which is the amount of money required to cover your care needs.

There are several ways of using your personal budget:

  • A direct payment (where the money is given directly to you)
  • A budget managed by the local authority
  • Having your budget managed by a third party (such as a care provider)
  • A combination of the above.

Most commonly, people ask the local authority to manage their budget and arrange their services, but you can receive your budget in the way that suits you best.

In most cases, your local authority will arrange to pay your care home directly. If you or a family member need to pay something towards your care as well, your payments can be arranged with the local authority or the care home. Start by talking to your local authority to set it up.

Once a local authority has worked out what they’ll pay and how much you’ll need to chip in, there may still be a gap to cover the full cost of the care you want. So, you might be asked to find a ‘third party top-up’. This can’t come from your own savings; it needs to be paid by someone close to you, like a partner, family member or friend.

A local authority can only ever ask for top-ups if they’ve found a lower cost care home for you that meets all your assessed needs and has availability. If they can’t find one, they’ll need to pay to cover your current shortfall.

There are two situations where you can pay your own top-up:

  • During the first 12 weeks of moving into a care home (12-week property disregard) as a permanent resident, if you’re going to use your property to pay for your care.
  • If you have a Deferred Payment Agreement. Where the local authority contributes to your care now, with repayment from the value of your property later.

Live-in care can be expensive, often costing more than £1,000 a week, which means it’s unlikely that a local authority will fund the full cost. Instead, they might recommend a care home as a lower cost alternative. Or, they could give you a personal budget, which you can top up with your own money or with help from family to meet the cost of a live-in carer.

If you think your care needs wouldn’t be properly met in a care home, you can challenge the local authority’s decision not to pay for live-in care.

You may also wish to explore releasing equity from your home to help give you greater flexibility.

Find out if you could use the value of your home to pay for any shortfall for in home care by completing our Care Costs Calculator.

Please be aware, if you take equity out of your home, you may no longer be eligible for financial support from your local authority.

Care Cost Calculator

Many people needing care find they’ll have to cover some or all of the costs themselves, and it can be daunting. But knowing all your options could help to save you money. Our Care Costs Calculator can help you to understand the cost of care in your area and fully explore your funding options.