Underestimation of long-term care costs is a big wake-up call According to a new Equity Release Council survey, over 55s are seriously underestimating annual long-term care costs. The finding underlines the importance of long-term care planning. The new figures highlight a lack of awareness with regard to long-term care costs and also a widespread inability to pay for care. According to the survey, people nearing retirement believe that the average annual cost of long-term care is around £16,000, when it is actually almost £30,000. It is not hard to see why the number of retirees selling their homes to fund long-term care is rising, in particular as the average income level for a pensioner is around £18,000. For many, the only way to bridge the gap and afford the care they need is to sell their cherished family home. But what about the government’s social care reform? It looks set to protect the poorest pensioners from what it calls catastrophic care costs, but the reform package is yet to be finalized and there are growing fears that the majority of pensioners who have modest if not substantial wealth will receive little or no help under the new guidelines. Most recently, the government has been accused of backtracking over the ability to defer payment, with talk of restricting eligibility to those with assets of £23,250 or less, the argument being that helping the poorest is a positive. However, in reality this is a very small group and, overall, the limit will mean that very few pensioners receive meaningful assistance. This is why it is essential to make long-term care planning a key part of long-term financial planning. Indeed, underlining the importance of regulated long-term care advice, the Association of Professional Advisers has recently called for the long-term care cap to include advice costs. To find out more about Independent Financial Solutions’ services, contact us on 0800 980 4316 or by using our enquiry form.
Posted on: Fri, 22 Nov 2013 10:06:05 +0000
Trending Topics
Recently Viewed Topics
© 2015