Cost of care

You don’t need an agency to find you a carer - keep control and save thousands.

See how much you could save by hiring a carer directly.

Cost calculator: an hour of care

Enter an hourly fee for the carer and compare costs

An example based on typical care arrangements at £17/hr

✦ RECOMMENDED

My Lighthouse

Employ a carer directly, without agency fees

Total hourly
cost

£19.56

Carer hourly fee£17.00

Employee benefits£2.56

Pension contribution (3%)

£0.51

Holiday pay (12.07%)

£2.05

NI contribution (with Employment Allowance)

£0

What are employment costs?

OPTION 2

Introductory agency

The agency only introduces the carer to the client. The carer acts as self-employed, meaning they are not entitled to employee benefits e.g. holiday pay, sick pay, pension contributions.

Total hourly cost

£22.10

£2.54 extra per hour

That’s £101.60 more for 40 hours of care

Carer hourly fee£17

Introductory and ongoing fees
(10-30%)

£5.10

OPTION 3

Managed care agency

Agency introduces carer to family. Carer and care plan is managed directly by the care agency with carer costs, benefits and agency fees invoiced as one.

Total hourly cost

£34.00

£14.44 extra per hour

That’s £577.60 more for 40 hours of care

Carer hourly fee£17

Introductory and ongoing fees
(60-100%)

£17

Employment costs

Choosing to employ a carer directly gives you control, flexibility and often significant cost savings compared to using a managed care agency.

It also means you become their employer — which sounds big, but in practice is very manageable once you understand the basics. Here’s what that looks like in simple terms.

The carer’s salary (gross pay)

This is the agreed annual salary before tax and National Insurance are deducted.

For example, if you agree a salary of £37,444 per year, that is the carer’s gross pay.

You’ll run payroll and deduct their Income Tax and employee National Insurance before paying them — these deductions come from their salary, not as an extra cost to you.

Employer National Insurance

As an employer, you also pay Employer National Insurance contributions on top of salary.

Most people employing a carer for personal care will qualify for the Employment Allowance, which can significantly reduce — and often fully cover — this cost.

Holiday pay

When you employ a carer directly, they are entitled to paid holiday, just like any other employee.

If they are a full-time employee on regular hours, their salary will cover holiday pay.

If they work irregular hours, holiday pay (12.07%) should be added on top of their pay. We’ve shown this in the ‘Cost calculator: and hour of care’.

Pension contributions

If your carer meets the age and earnings criteria, you’ll enrol them into a workplace pension.

You’ll contribute:

Minimum 3% of qualifying earnings

On a salary of around £37,444, this is often around £930 a year.

Providing a pension is part of being a responsible employer — and gives your carer long-term security while they support you.

Employers’ liability insurance

You must have employers’ liability insurance if you employ any staff, such as a carer.

This covers legal fees and compensation claims if an employee becomes ill or injured because of their work.

Costs start at around £9 per month.

We haven’t included this in the cost calculator, as the hourly cost is very small (around 5p - 10p per hour for a full time employee).

Find out more about employers’ liability insurance.

What does this mean overall?

Using a carer fee example of £15 per hour, your additional employment costs would be around £2.26 per hour, so you would need to budget for an hourly cost of £17.26.

Carer hourly fee£17.00

Employee benefits£2.56

Pension contribution (3%)

£0.51

Holiday pay (12.07%)

£2.05

NI contribution (with Employment Allowance)

£0

Total hourly
cost

£19.56

Even with these included, hiring directly is frequently far more cost-effective than paying agency management fees, which can add many thousands of pounds each year.

Importantly, direct employment:

Saves thousands of pounds

and gives you:

Control over who supports you

Ability to build a long-term working relationship

Transparency over where your money goes

FAQs

Savings vary by hours, region and pay levels, but many families save thousands a year.

Illustrative example: 30 hrs/week × 52 weeks = 1,560 hrs. Agency at £34/hr = £53,040/yr. Self-managed carer at £17/hr, plus typical employer costs (NI, pension, holiday, modest admin) ≈ £30,510/yr → ≈ £22,500 saved.

(Use the calculator for a personalised figure - this is illustrative, not a guarantee.)

Self-managed costs usually include: the carer’s gross pay, employer National Insurance, employer pension contributions, holiday pay, payroll/admin fees, and occasional insurance costs (though check if this is included in your house insurance policy already). Our calculator includes these line items so you see the real net cost, not just wages.

Yes - in most typical scenarios people still come out ahead. The big reason is agency mark-ups: agencies charge higher hourly rates to cover staff, overhead and profit. Even after employer obligations are added, direct employment usually costs less. The calculator shows agency vs self-managed after typical employer costs so you can compare apples to apples.

Common agency add-ons: higher hourly rates for nights/holidays, travel/time surcharges, minimum call-out fees, higher rates for last-minute cover and agency mark-ups to cover agency overheads. Agencies also charge for holiday and sickness cover which can be billed at premium rates. Hiring directly removes most of these layered mark-ups.

We reduce cost drivers before you even hire:

Find better matches so carers stay longer (less costly turnover).
Lower recruitment cost with ready adverts, interview scripts and optional boosting.
Vetting done by you to avoid costly mismatches and short-term agency reliance.
Step by step contract building, to clarify details and reduce early exits.
Contingency planning so you avoid expensive last-minute agency cover.

Note: we currently provide the above tools and guidance for recruitment, vetting and hiring. For payroll/pension/insurance we’ll signpost trusted partners until our managed admin service is available.

Yes. Many households get help from NHS Continuing Healthcare, Attendance Allowance, Carer’s Allowance, or local authority means-tested support. These don’t always cover everything, but they can significantly reduce your out-of-pocket costs. We’ll signpost where to check eligibility and how to apply.

Find out more about funding options