Becoming a Special Guardian can give a child something they may have been missing for years: the security of knowing where they belong.

For foster carers who already look after the child, the decision can feel like a natural next step. The child stays in a familiar home, relationships continue, and everyday family life may change very little.

The financial arrangements, however, can change considerably.

Fostering allowances and fees do not automatically continue when a Special Guardianship Order (SGO) is made. Instead, financial assistance is considered under a different legal framework, with eligibility depending on the child’s circumstances, the carer’s needs and the local authority’s assessment.

Understanding those differences before the court makes an order can help families avoid unexpected financial pressure.

This guide explains how Special Guardianship financial support works in England, what former foster carers should ask their local authority, and how to prepare a realistic household budget.

What Changes When a Foster Carer Becomes a Special Guardian?

A Special Guardianship Order is a court order that gives a person parental responsibility for a child until the child turns 18, unless the order is changed or discharged earlier.

Special Guardians can make many important decisions about the child’s upbringing. Parents generally retain parental responsibility, but the Special Guardian can usually exercise it to the exclusion of others on most matters. Certain decisions remain subject to legal restrictions.

Unlike fostering, Special Guardianship is intended to provide a more permanent family arrangement without the child remaining in foster care.

That change affects both professional involvement and financial support.

While an approved foster carer receives payments under fostering arrangements, a Special Guardian may instead receive financial assistance through the local authority’s Special Guardianship support framework.

The distinction is important because a household that was financially sustainable during fostering may face different circumstances after the order.

Fostering Allowances vs Special Guardianship Allowances

Fostering payments generally include an allowance for the child’s care. Some foster carers also receive a separate fee or remuneration element, depending on their fostering arrangement.

Special Guardianship financial support operates differently.

Local authorities may provide regular allowances or other financial assistance where the relevant legal conditions are met. Financial assessments commonly consider household resources, reasonable outgoings and the child’s needs.

However, not every payment is assessed in the same way, and there are exceptions within the regulations.

Before agreeing to an SGO, ask the local authority to explain how each current payment would be treated after the order.

Do not assume that an existing fostering payment will continue unchanged.

Can Former Foster Carers Keep Their Fostering Fees?

This is one of the most important questions for carers considering Special Guardianship.

Under Regulation 7 of the Special Guardianship Regulations 2005, a local authority may include an element of remuneration in financial support where a person previously fostered the child and received remuneration as part of their fostering payments.

The decision to include that remuneration must be made before the Special Guardianship Order is granted.

Where the relevant conditions are satisfied, transitional remuneration can continue for up to two years after the order.

It may continue beyond two years if the local authority considers this necessary because of the child’s exceptional needs or other exceptional circumstances.

This is not an automatic entitlement for every former foster carer.

For someone who relies on fostering fees to meet mortgage payments or other household commitments, the distinction could be significant.

Before the court hearing, ask:

• Does my current fostering payment include a separate remuneration element?
• Will any remuneration continue after the SGO?
• What amount has the local authority agreed?
• When will that payment end or be reviewed?
• Has the decision been recorded in writing?

The Department for Education’s statutory guidance explains the purpose of transitional remuneration: to help eligible former foster carers adjust to the financial change.

Families should obtain clarity before the order is made rather than assuming the issue can be resolved afterwards.

How Does a Special Guardianship Financial Assessment Work?

Local authorities assess financial support under the applicable Special Guardianship Regulations.

The assessment may consider the prospective guardian’s financial resources, reasonable household commitments, benefits and the child’s financial needs.

Certain forms of assistance are subject to different rules or exceptions.

A financial assessment should therefore be considered in the context of the specific support being requested, not simply as a calculation of household income.

Prepare a Clear Picture of Household Finances

Begin with a realistic monthly budget.

Include employment income, current fostering payments, housing costs, utilities, transport, food and other essential expenses.

Then identify costs specifically connected with the child’s care.

These might include additional travel, disability-related needs, specialist equipment or other expenses that can be explained and supported with evidence.

It is useful to distinguish ordinary household spending from costs arising because of the child’s particular circumstances.

Explain the Child’s Individual Needs

A child who has experienced trauma, disrupted placements or additional educational needs may require ongoing support.

That support is not always financial.

It may involve counselling, therapeutic services, help with family contact or access to specialist advice.

Where these needs exist, ask the local authority how they will be assessed and what support can be included in the arrangements.

Request the Assessment Outcome in Writing

Ask for a written explanation of any proposed financial support.

The document should make clear what has been agreed, the payment arrangements, applicable conditions and how reviews will take place.

If the calculation is unclear, request an explanation before relying on the amount in your family budget.

Why the Special Guardianship Support Plan Matters

The Special Guardianship support plan can be one of the most important documents in the transition.

Where a written plan is required, it should set out the support to be provided and relevant arrangements for delivery and review.

Families should discuss the proposed support plan before the order is finalised.

A useful plan may address:

Do not rely solely on verbal assurances.

Keep copies of assessments, correspondence and the final support arrangements.

If you disagree with a proposed decision, ask about the relevant representations, review or complaints process and consider obtaining independent legal advice.

What Additional Benefits Can Special Guardians Claim?

Becoming a Special Guardian may change eligibility for certain benefits, but entitlement is not automatic.

Different benefits have different rules, and the effect of local authority financial support must be checked in the context of each benefit.

Child Benefit

A Special Guardian may be eligible to claim Child Benefit for a child they are responsible for.

Only one person can receive Child Benefit for the same child at a time.

Families should check the eligibility rules and make the appropriate claim or report a change in circumstances to HM Revenue & Customs.

Universal Credit

Some Special Guardians may qualify for Universal Credit, including additional support for children, depending on their circumstances.

Eligibility depends on factors such as household income, capital and responsibility for the child.

For kinship carers, the rules can differ depending on whether the child is formally looked after by a local authority.

The government provides specific guidance on Universal Credit for family-and-friends carers.

Disability-Related Support

Where a child has a disability or additional care needs, families may wish to explore relevant disability benefits and support services.

Eligibility depends on the child’s circumstances and the applicable benefit rules.

A Special Guardianship Order alone does not establish entitlement.

Local Authority Financial Assistance

Some families may qualify for financial support towards particular needs or initial costs.

The availability and assessment of this assistance depend on the statutory framework and individual circumstances.

Ask the local authority what support can be considered and whether any specific expenses require approval before they are incurred.

Can Special Guardians Access Therapeutic Support?

Children who move from foster care into Special Guardianship may have experienced difficult family circumstances, loss or trauma.

Some benefit from therapeutic support after the order is made.

In England, the Adoption and Special Guardianship Support Fund (ASGSF) can provide funding for eligible therapeutic services following an assessment of need.

The fund is not a general cash allowance paid directly to every Special Guardian.

Eligible families normally access support through the relevant local authority or regional adoption agency, which assesses needs and applies for funding.

Eligibility depends on the child’s circumstances and the scheme’s rules.

The fund has been confirmed for 2026–27, with government plans for continued support into 2027–28. Funding limits and operational arrangements can change, so families should check current guidance before arranging therapy.

If therapeutic help may be needed, raise the issue during the Special Guardianship assessment rather than waiting until a problem becomes more difficult to manage.

Creating a Financial Plan Before the SGO Is Made

A realistic budget can make the difference between a manageable transition and months of financial uncertainty.

The aim is not to predict every expense. It is to identify where household finances may change and decide how those changes will be managed.

Compare Income Before and After the Order

Start by listing current income, including fostering allowances and any separate fees.

Then prepare a second budget using only payments that are confirmed or reasonably expected after the SGO.

Keep uncertain payments separate.

This avoids building a household budget around financial assistance that has not yet been approved.

Account for Future Expenses

Children’s needs change as they grow.

School travel, clothing, activities, technology, educational support and transport may become more expensive.

Some children may also require specialist services that are not fully covered by existing support arrangements.

A financial plan should allow for these possibilities without assuming every future cost will be funded by the local authority.

Plan for Payment Reviews

Ongoing Special Guardianship financial assistance may be reviewed.

Changes in household income, the child’s circumstances or available benefits can affect the assessment.

Keep records up to date and understand any obligation to report changes.

Build a Financial Buffer Where Possible

An emergency fund can help cover unexpected expenses or temporary delays.

Not every family will be able to save immediately, especially during a major change in care arrangements.

Where savings are limited, prioritise understanding confirmed income, essential expenditure and available support.

Review Longer-Term Arrangements

Special Guardians may also need to consider wills, insurance, employment arrangements and plans for the child’s care if circumstances change.

Legal and financial advice can be valuable where family circumstances are complicated.

Common Financial Mistakes to Avoid

Assuming Fostering Payments Will Continue

Fostering allowances and fees do not automatically transfer to Special Guardianship.

Request a written breakdown of what will change.

Leaving Financial Discussions Until After the Court Order

Some decisions, including transitional remuneration for eligible former foster carers, need to be addressed before the SGO is made.

Raise financial concerns early.

Treating Every Allowance as Guaranteed

Financial support depends on the relevant legal rules, assessments and individual circumstances.

A payment made to another Special Guardian does not necessarily establish what your household will receive.

Overlooking the Child’s Additional Needs

A budget that covers food and clothing but ignores therapy, transport or disability-related costs may not reflect the child’s circumstances.

Explain these needs during the assessment.

Relying on Outdated Benefits Information

Benefit rules and funding arrangements change.

Use current government guidance and seek specialist welfare-benefits advice when necessary.

Frequently Asked Questions

Do Foster Carers Continue Receiving Payments After Becoming Special Guardians?

Fostering payments do not automatically continue. Special Guardians may qualify for financial support under a different framework, and some eligible former foster carers may receive transitional remuneration.

Are Special Guardianship Allowances Means-Tested?

Regular financial support is commonly assessed with reference to household finances and the child’s needs. However, statutory exceptions apply to certain types of assistance, so not all support is treated identically.

Can a Former Foster Carer Receive Fees for Two Years After an SGO?

In certain circumstances, transitional remuneration may continue for up to two years. The decision must satisfy the relevant regulatory conditions and be made before the order. Continuation beyond two years is possible only where the applicable exceptional circumstances justify it.

Can Special Guardians Claim Child Benefit?

They may be eligible if they satisfy the relevant Child Benefit rules. Only one person can receive Child Benefit for the same child.

Can Special Guardians Receive Universal Credit?

Some Special Guardians may qualify, depending on income, capital, responsibility for the child and other eligibility requirements.

Is Financial Support Reviewed After a Special Guardianship Order?

Ongoing financial assistance is subject to review under the applicable rules. Families should ask how and when reviews will take place and what changes they must report.

Can Special Guardians Receive Funding for Therapy?

Eligible children may be able to access therapeutic services through the Adoption and Special Guardianship Support Fund, following assessment and an application by the relevant authority.

What Should I Do If I Disagree With the Financial Assessment?

Ask for the decision and calculation in writing, request an explanation of the applicable review or representations process, and consider advice from a specialist family-law or kinship-care organisation.

Conclusion

Moving from fostering to Special Guardianship can provide a child with lasting family stability, but the financial transition deserves just as much attention as the legal arrangements.

For former foster carers, the most important step is to understand what happens to existing allowances and fees before the court makes an order.

Ask for a clear financial assessment, discuss the child’s individual needs and make sure any agreed support is properly documented.

Review possible benefit entitlements, explore therapeutic support where appropriate and build a household budget based on confirmed arrangements rather than assumptions.

Special Guardianship is a long-term commitment. Getting the financial details right at the beginning can help families concentrate on what matters most: providing a safe, stable and supportive home.

References and Further Reading

1. GOV.UK — Special Guardianship Guidance — Department for Education statutory guidance on Special Guardianship and support arrangements.
2. The Special Guardianship Regulations 2005 — Legal framework covering financial support, assessments, remuneration and reviews.
3. GOV.UK — Universal Credit if You Have Children — Government guidance, including provisions for kinship carers.
4. GOV.UK — Adoption and Special Guardianship Support Fund — Current eligibility and arrangements for therapeutic funding.
5. Kinship — Special Guardians’ Financial Support and Benefits — Independent guidance on allowances, benefits and financial support.
6. Family Rights Group — Independent advice and information for families involved with children’s services.

Legal and financial disclaimer: This article provides general information about Special Guardianship in England. It is not legal, tax or financial advice. Eligibility, support arrangements and benefit rules depend on individual circumstances and may change. Prospective Special Guardians should seek advice from their local authority, an appropriately qualified legal adviser or an independent kinship-care support organisation before making decisions.

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