There is a 50/50 split between self-funded and state-funded residents in care homes for older people, figures from the ONS have uncovered, indicating a key role for financial advisers in helping people to navigate a new care funding system according to retirement specialist Just Group.
While just over a third (36.7%) of all care home residents are funding their own care, this rises to around four in 10 (39.2%) for care homes providing dementia care and just under half (49.6%) among those in care home for over 65s.
In total, the figures estimate around 135,000 people are self-funding their care in homes for older people or those providing dementia care.
With new rules around funding care set to be introduced by the government, financial advisers will have a key role to play in supporting people paying for their own care in navigating what is still likely to be a complex system according to Just Group.
The research, carried out before the Prime Minister’s care funding announcement, found that the majority of over 45s (52%) approaching a local council to arrange care for themselves or a loved one would find a referral to a professional financial adviser helpful in planning how to meet care costs.
Over a quarter (26%) would then arrange to meet a financial adviser, 16% would make contact over the phone and 14% said it would prompt them to speak to their own adviser. Only one in seven (14%) said that they would choose not to speak to an adviser if they were referred to one.
“The evidence shows there are well over a hundred thousand people funding their own care in homes for older people or those suffering from dementia,” said Stephen Lowe, group communications director at Just Group. “Organising care is an onerous undertaking and requires good knowledge of the funding and benefits system and how they can affect an individual’s financial circumstances.
“The Prime Minister’s reforms may start to address long-standing issues within the sector, but as with any new system it will be vital that people receive support to understand their options and make the best decisions for themselves and their family members.
“Financial advisers will continue to play an important role in encouraging people to consider care costs so they have a plan in place and are not surprised by the fees they may have to pay.”
He added that a clear business opportunity exists for advisers with the professional qualifications, knowledge and experience of the care market to provide financial planning for those organising care for relatives or planning their own financial future.
“Currently, advisers are not at the front of people’s minds when people think about where they might seek support, with just 13% saying they would seek the help of a professional financial adviser,” said Stephen Lowe.
“However, when prompted with the idea of a referral to an adviser by their local authority only one in seven said that they would turn down the opportunity. Care is in the spotlight following the reforms the Prime Minister announced. Advisers who have the expertise, skills and qualifications in this area could quickly become the ‘go to’ experts in what is likely to be a growing business area in the near future.”