Just one in four over 50s are aware of the weekly cost of long term care and many make no provision to cover the expense.
Only 26% of people asked could correctly state the average weekly cost of long term care – which is £504 a week, according to the findings of a report from the Equity Release Solicitor’s Alliance (ERSA).
Around four out of 10 (41%) believed the cost was significantly lower and only 14% of those over 66 years old could say how much residential care really costs.
The survey went on to ask how the over 50s would fund long term care.
Four out of five (80%) had no idea how their local authority would assess their finances if they needed long-term care, and did not know how much they would have to pay personally.
Some had thought about how they would pay for care – but only a low number.
A fifth (22%) plan to fund care from savings, 16% from pension payments and 11% will explore releasing equity from their homes.
Many are concerned about equity release, and a third (32%) stated they would feel a lot better about signing up if the government backed the scheme.
Claire Barker, chair of ERSA, welcomed the Dilnot Commission’s report in to the funding of long term care.
“Anything allowing people better understanding to plan for their retirement is to be encouraged,” she said.
“Equity release has always had a role to play here. In the first instance, it often allows people to stay in their own homes for longer and to pay for care there but it also has a major role to play with paying for residential care costs too.
“If the government offers an endorsement of equity release we will see a significant shift in the number of people looking for advice about how equity release can form part of their financial planning in retirement.”
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