Research commissioned by insurance and financial services company Canada Life has revealed that nearly a third (30%) of over-60s don’t expect to pay for later-life care costs, with two in five (41%) also never expecting to pay for the care of a loved one.

Despite the growing need for care in later-life and the average cost being an estimated £600 to £800 a week, over a quarter (27%) said they don’t know how they would pay for care and about a fifth (18%) have not planned that far ahead yet.

For those who have thought about how they may pay for care, more than a quarter (27%) of over-60s said they would use their state pension (down from 37% in 2021), followed by 25% who would use cash savings (down from 35% in 2021), and their private pension (18%).

Other ways over-60s expect to pay for care include 14% who said they would sell their assets such as their house, 13% said they expect the government to cover the cost of care, 9% said they would release equity from their home, and 5% would use an inheritance.

Alice Watson, head of marketing, insurance at Canada Life, said: “Despite recent efforts from government to tackle the care crisis, including the introduction of the social care levy and cap, with people living longer, the harsh reality is that more people will need care – and this must be paid for.

“However, it’s clear there is a lack of understanding and awareness over who is expected to pay for care, just how much it could cost and how to plan for covering any care needs in later-life. For example, the lifetime cap of £86,000, doesn’t include all daily living costs, and could be misleading for those who think it includes all costs. It’s likely, therefore, that many individuals will still need to contribute above and beyond the cap.

“This is where advisors have a crucial role to play in helping those in and approaching retirement to plan ahead. The possibility of having to pay for care is now a crucial part of retirement planning. Advisors will be able to help customers navigate the various options available, whether that be using their pension, their property wealth, or a combination of the two, to allow them to plan ahead with certainty.”