PANDEMIC FUELING CARE FEES UNCERTAINTY
13 May 2022
- 35% of over-55s say COVID-19 will make them consider their care options
- Average cost of nursing care can be as much as £51,000 a year, Key’s Care Report: Tackling the Care Question shows
Over a third (35%) of over-55s say the pandemic has made them carefully consider their later life care options while 29% say it has made them more determined to receive care at home than ever before, a report from the UK’s later life lending specialist Key shows.
Key’s Care Report: Tackling the Care Question – the third it has published since 2019 –questioned over-55s about how they would like to receive care in the future and how they’ll pay for it. The report noticed a marked difference in over-55s financial confidence prior to the pandemic compared to how they feel as things start to return to normal.
Indeed, fewer people felt they could meet the cost of care using savings and investments (-11% to 33%) and pension income (-8% to 32%) while there was an increased expected reliance on local council funding (+6% to 14%). Interestingly, we saw marginally less people say they have no idea how they would meet these costs (-1% to 14%) while the proportion who knew they would be unable to pay for care double (+6% to 11%).
|Use savings and investments||44%||33%|
|Pension income would fund care||40%||32%|
|Access housing equity||19%||26%|
|No idea how I would meet these costs||15%||14%|
|Know I can’t meet these costs||5%||11%|
|Rely on local council||8%||14%|
|Relay on family and friends||2%||5%|
More than one in four (26%) say they will use equity tied up in their home to help them which is higher than in 2019 when just 19% said they would use property wealth as part of care funding.
Will Hale, CEO at Key, said: “The pandemic has impacted not only how people live their day to day lives but also how they plan for the future. While the fact that the vast majority of people will need to make some contribution towards their own care has been a reality for many years and is likely to remain a constant even under the new Care Bill, people are starting to wake up to what this actually means.
“Unfortunately, this has seen an increase in people who are worried about how they will meet these costs, dubious about how well their pensions and investments might support their choices and therefore looking to rely more on local authority support. Others are keen to use their housing equity and more determined than ever before to receive care in the comfort of their own homes.
“People need to remember that forward planning is vital to ensuring that you have choices around how you pay for care and increasingly a multi-asset approach works best. Taking the time to speak to an adviser who specialises in financing care and navigating through the system can play dividends in the future.”
The potential care bill
Key’s report also highlights the average annual cost of nursing care in a home is the highest in England at £50,908 while the highest average residential care costs are in Scotland at £39,988. However even the lowest UK average residential care costs in Northern Ireland are £28,652 while the lowest average nursing care costs are £36,712.
Even paying for care at home can be expensive – around two hours a day can still cost about £16,800 a year, the report says
|REGION||AVERAGE RESIDENTIAL CARE COST||AVERAGE NURSING CARE COST|