Very few people saving to fund their social care

New research shows that social care barely registers as a planning or funding priority when it comes to retirement planning.

Only 7% of people in the UK say that they intend to save for possible future social care needs with just 1% viewing it as their single greatest financial priority.

According to pension provider Aegon’s global retirement study, health is placed as the most important consideration, with more people worried about declining health (48%) than running out of money (42%).
Aegon suggests that the findings may be down to the perception that it’s something the government will pay for with 38% say they haven’t factored in care as a future expense because it will be provided by the NHS, while 31% simply haven’t considered it at all.

Steven Cameron, pensions director at Aegon said: “Many individuals face significant and at times catastrophic costs, wiping out their life savings, if they need to go into a care home. While the issue of social care has been brought into sharp focus as a result of Covid, the research shows consideration of how to fund it is a worryingly low priority.

“It may be that too many people still believe that social care funding is an issue for the government to sort out. Compared to other countries, UK citizens benefit greatly from having access to the NHS, but all too often, people wrongly believe that their social care needs in later life will also be taken care of by the state.

“The issue of social care and how to cover personal contribution to costs needs much greater consideration within the overall retirement planning process. When the UK Government does set out its new deal, it will be vital to incentivise people to plan ahead and save for their possible long-term care in older age.”

Date Published: February 8, 2021