It was interesting to read the Third Care Index from insurer Partnership, which has found significant confusion around care funding.
Partnership has tracked views and attitudes towards the forthcoming shakeup of the Social Care System, concluding that 72% believe needing care in later life is ‘something that happens to other people’.
These people, over the age of 45, say it is not likely they will go into a residential care home in later life. The facts suggest otherwise.
The report explains there are currently 426,000 older or physically disabled people living in residential care settings in the UK.
With over 65s due to represent more than a quarter of the UK population by 2046 (the Baby Boomers are coming!), this number is only likely to get bigger.
The Third Care Index found that most people have not thought about care or spoken to their families about the issue.
78% of over 45s are burying their heads in the sand when it comes to the need for care in later life.
Nearly half of people surveyed in the Third Care Index were adamant that care was not something they would need to consider; ‘it just would not happen to them’.
Also within the report were figures which suggest the average stay in a residential care home is around two years.
However, for a self-funder, this duration of stay is typically longer at 3.5 years.
Of course in both cases these are average figures and a stay in a residential care setting can be much longer, resulting in higher total care fees.
There remains a big gap between perception and reality when it comes to the cost of care.
The Third Care Index found the actual cost of care in 2014 was £28,600, compared to an anticipated cost of care of £27,203, with 63% anticipating a cost of under £25,000.
Looking at sources of funding for care, in the South East the report found 39% believe people should sell their homes to pay for care.
Regardless of opinions, selling their home was the most popular option for funding care fees, with 35% saying they would sell their home, 34% saying they would use pension income and 29% using savings.
Considering family involvement in care provision, the majority (78%) of over 75s do not want their children to take care of them in later life.
Women were more reluctant than men to have their children involved in care provision across all age groups, with 53% of men compared to 59% of women not wanting their children to be involved.
When the subject of the new Care Act was raised, respondents to the survey were confused by the plans for care funding.
61% of people said they were confused, with a range of opinions about how much financial support the state should offer towards care fees in later life.
As a Financial Planner who works with people to plan for the cost of care in later life, it is always interesting to read these reports and see how people view the various aspects of care funding.
What is essential is to seek expert and independent financial advice to ensure all of the options for funding care are properly considered before important decisions are made.
