People not planning for future care costs

Citizens Advice

A Citizens Advice study has found that three in five people who have taken money out of their pension have not planned how they will meet future care costs.

The survey of over 500 people who have accessed their pension since April 2015 found that just 16% had budgeted for care costs when they grow older.

Gillian Guy, chief executive of Citizens Advice, said: “Care costs can be a heavy financial burden that many people are unprepared for.

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“It is unsurprising that many people in their fifties are not thinking about how they will pay for care costs when the need for this could be 10, 20 or even 30 years away. But this issue does need some attention, otherwise people risk dipping into their pension now only to find they need some of the money later.

“Getting the right guidance is key in helping people think about and plan how they will fund their retirement – including costs which are more tricky to consider, such as care fees.

“There is also an opportunity for local authorities to help people plan ahead for future care costs, by providing clear information about how funding for care works and how much it costs.”

Of those who had no plan for future care costs, the study found one in 10 would rely on others such as family of the government.

Almost one in three (29%) said they had thought about future care costs but had no plan to meet them.

A further three in five (60%) said they had not thought about how they would pay for future care needs.

The research also finds those without a plan for future care costs are more likely to still be in work, with two thirds (66%) of people employed full-time lacking a plan, compared to just over half (56%) of people who have already retired.

Currently around 4 million older people, nearly half of those aged over 65 in England, have care needs.

The report comes after a recent study by Prestige Nursing + Care found that care home fees had rocketed past £30,000 for the first time (see Care home costs soar past £30,000 mark).

Tags : FeesFinanceFinancial AdviceFunding
Lee Peart

The author Lee Peart

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