When Care Costs Rise, Where Do Families Turn?

When Care Costs Rise, Where Do Families Turn?

 by Guy Olson, The Equity Release Partnership

This month I wanted to talk about a client we helped last month, because her situation highlights a side of our work that doesn’t always get the attention it deserves.

She’s 87 years old and lives alone in the home she loves. Unfortunately, she suffers from severe osteoarthritis, which has left her largely bed bound in her living room. The room has had to be adapted to meet her needs and she now relies on carers visiting throughout the day to help with everyday tasks.

She receives Attendance Allowance and all her pension income goes towards covering the cost of the carers she now needs. But like many families are discovering, the cost of care’s rising steadily, particularly when agency carers are involved. Over time she’d used up all of her savings and had even reached the point where she’d started selling pieces of jewellery simply to keep up with the cost of her care.

Earlier this week we helped her release money from her home to change that situation.

The funds raised will now cover the additional care costs she needs for as long as she’s likely to require them. We’ve also arranged a little extra to repair her roof, along with a contingency fund to cover any unexpected expenses that may arise in the future. Most importantly, she can now remain in the home she loves, receiving the care she needs, without the constant worry about how she’ll pay for it. Just as importantly, her family now has the reassurance of knowing that she’s safe, comfortable and well looked after.

It’s exactly what equity release was originally designed for. Long before it became associated with funding lifestyle ambitions, it was created as a way for older homeowners to access the wealth tied up in their property to support their care needs later in life.

When people think about releasing equity from their home today, the conversation often centres around the more obvious things. Helping children onto the property ladder, funding a dream holiday, or finally replacing the avocado-green bathroom from 1976. All perfectly reasonable ambitions.  But there’s another side to later life lending that’s often overlooked.

Care.

It may not be the most glamorous subject for a networking newsletter, but it’s becoming one of the most important financial conversations many families will face.

The UK population’s ageing rapidly, and with that comes a growing need for support in later life. Age UK estimates that around two million older people in England are currently living with some form of unmet need for social care. At the same time demand continues to rise. In 2023/24 local authorities received around 1.43 million requests for support from older people, yet only a proportion of those requests resulted in long term care being arranged. Research also suggests that around a quarter of people aged over 65 report unmet needs for help with everyday activities, such as dressing, bathing or getting around the home.

The financial reality behind those statistics can be significant. Self-funding residential care in the UK now averages around £1,298 per week, rising to approximately £1,535 per week for nursing care. Even care at home isn’t inexpensive. Live-in care can cost between £1,200 and £1,500 per week depending on the level of support required. When you start to run the numbers, it becomes clear why care’s one of the largest financial challenges many families will ever face.

Another important part of this story is the role played by families themselves. There are currently around 5.8 million unpaid carers in the UK, many of whom are supporting elderly parents while also juggling careers, children and other responsibilities. These individuals are often referred to as the sandwich generation, caught between caring for older relatives and supporting younger family members at the same time.

While these figures can feel daunting, the reality is that care doesn’t always mean moving into a residential home. In fact many people want to remain in their own homes for as long as possible. Support can come in many forms, from a few hours of help each week, to daily home care visits, live-in carers, or adapting the home to make independent living easier.

For many retirees their home represents their largest asset, yet much of that wealth remains tied up in bricks and mortar. Used in the right circumstances, accessing that housing wealth can provide families with options at a time when those options are most needed.

Later life lending will always help people enjoy retirement. But sometimes its most valuable role is much quieter. Sometimes it simply allows someone to remain in the home they love, with the care and dignity they deserve, while giving their family the reassurance that everything’s taken care of.

And for the lady we helped this week, that’s exactly what it means, being able to stay in her own home, with the care she needs, and without the constant worry about how she’ll pay for it.

About the Author

Guy Olson – Managing Partner, The Equity Release Partnership

Guy is a later life financial specialist with a background in equity release and wealth planning. He works closely with solicitors, accountants, care providers and financial advisers to help clients make smart, practical decisions about their finances, whether that’s funding care, supporting family or navigating the financial challenges of later life. Guy is a member of the Society of Later Life Advisers (SOLLA) and the Equity Release Council, and brings a clear, down to earth approach to topics that can otherwise feel daunting.

Email: 
Mob: 07583 992335
Tel: 0333 050 9944