With care very much on the agenda this week, Partnership reveals that the vast majority of over-65s have not spoken to their families about the potential need for care and are confused around their financial options.
A staggering 96% of over-65s have made no financial plans to pay for care should they need this later in life and 73% have not spoken to their families or even thought about the subject. This is particularly worrying as the specialist insurer has found that families are often intimately involved in the process of finding their older relatives care – 20% of 45-50s and 21% of 51-55s say they expect to find a care home for their parents/parents in law.
In addition to putting off care conversations and planning, people are unaware of the financial products that can be used as part of care fees planning – as are their children. While care annuities are the only product specifically designed to meet care costs in return for a one off premium – and if paid directly to a registered care provider income is tax free – general awareness of these products was very low.
|Percentage of Children unaware (i.e. 45 -54 )||Percentage unaware (over-65s)|
|Immediate Needs Annuity||78%||81%|
|Deferred Payment Scheme||68%||68%|
|Long-Term Care Bonds||52%||55%|
However, while over-65s were unaware of these options, many were interested in further information. One in four (25%) wanted to understand more about immediate needs annuities, 25% expressing an interest in care annuities and 21% wanting additional information on the deferred payment scheme. This suggests that while people may not actively seek out information if asked they are open to discussion around the options.
Thomas Kenny, Head of Technical Pricing, Partnership, said:
“Care is very much on the agenda at the moment but this research highlights that not only have most people not made any plans or spoken to their families, they don’t know what their options are when it comes to paying for care. This is likely to be due to the fact that very few people want to consider the possibility of needing long-term care in later life.
“However, while there is a very low understanding of the products that can help people manage long-term care costs, some over-65s are clearly interested in understanding more about their options. This suggests that advisers should be speaking to their clients to see if they – or their parents – want further information on care planning. Taking time to consider their options now will pay off in the long run.”
– This research forms part of Partnership’s Third Care Index for the full report – click here