Government Considers Care ISA to Fund Health Costs

The Treasury is believed to be considering a Care ISA, allowing savers to contribute towards their later-life health costs tax-efficiently

James Gard 23 August, 2018 | 8:12AM

care ISA healthcare costs lifetime care social care government

The individual savings account (ISA), is 20 years old next April, and what was once a simple savings solution is now available in various iterations; to help young people buy a house, to boost your retirement income and – potentially – solve the pressing problem of soaring health and social care costs in later life.

Funding social care is one of the biggest funding challenges faced by the Government as life expectancy continues to increase. The Treasury is believed to be considering a “Care ISA” so that people can contribute towards their later-life care. Much like auto-enrolment was designed to relieve the pressure on the State Pension to provide an income for pensioners in retirement, the care ISA would shift the burden of paying for care from the State to the individual.

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James Gard  is content editor for Morningstar.co.uk

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