Aviva's latest Real Retirement Report reveals those aged 65-75 were the most averse to seeing their homes sold to pay for care (68%) - potentially as they have already ear-marked the equity for other costs in retirement.
Despite Government warnings that the current elderly care system is unsustainable, 70% of over-55s don't believe that they should pay for care in retirement.
Of those who do, they state that just £3,610 is a fair cost for a lifetime of care, reveals Aviva's latest Real Retirement Report.
While the majority of over-55s would prefer not to pay for care, they do concede that it is unlikely that the State will be able to pay for everyone's care.
The most popular funding options were for the ‘better off' to contribute to the cost of their own care but for the Government to pick up the tab for everyone else (51%) or for those who can afford to, to contribute to the cost of care (36%).
How affordability is determined was a matter for debate with some suggesting it should be based on current assets (16%) and others feeling lifetime income (14%) should be the measure. Irrespective of what system was used, the majority (53%) felt there should be a cap on how much an individual was forced to pay towards their own care.
Despite the fact that under the current system people are expected to finance aspects of their care, the research highlighted a significant lack of preparation. Over half (53%) of over-55s have no plans at all in place to meet these costs and 14% continue to believe that the Government will cover all the fees.
Even amongst those who do say they have some plans in place, just 2% have long-term care insurance with others preferring to rely on savings and investments (13%), housing equity (9%), their pension funds (3%) and on family assistance (3%).
Just 19% of over-55s say they are relaxed with the majority feeling concerned (41%), just over a quarter feel worried (29%) and - even - terrified (12%) about the prospect of meeting long-term care costs. While there were lots of different options as to how care should be funded, one clear message from the research was that the over-55s needed more guidance.
Indeed, almost half (47%) said there needs to be clearer information on the topic, 46% felt the Government should set clear universal care standards and 36% would like to see a single Government department responsible for all care issues. This move would help to clear up any confusion as 48% of people look to the State in one form or another for advice on this issue - 18% to the Government directly, 16% to their local council and 14% to a medical professional.
Clive Bolton, ‘at retirement’ director at Aviva said: “With a rapidly ageing population and the Government sending clear signals that it can’t finance care for all those who need it in retirement, there is significant need for advice.
“However, just 11% of consumers would consult financial advisers for advice and 5% would speak to a financial services company on how to cope with the cost of care.
“How to meet long-term care fees is a problem that financial services companies such as Aviva are actively considering. This issue is made particularly challenging by the fact that the actual cost of care is only determined when it is needed rather than when it is planned and paid for.
“However, the proposals in the Dilnot Review mean that going forward there is potential for much greater clarity around costs so it will be easier for consumers - and companies - to plan for the future.
“This can only be good news for advisers and we hope to see more entering the market as its potential becomes apparent.”
