Some two million elderly people have been forced to dip into their savings to pay for care costs, a survey by a national insurance company has revealed.
Research undertaken for the NFU Mutual insurance group shows around a million homes have been sold to cover care costs in the last five years, causing three out of four people whose parents go into care to forego all or most of any financial inheritance from their parents.
The findings suggest more than three quarters (77%) of those whose parents or in-laws had needed residential care had lost out on a significant part of savings that they would otherwise have inherited.
Around half claimed their parent’s care bills were met from savings and 28% said the family was forced to sell their parent’s home to pay care costs.
Under current arrangements, anyone with savings of more than £23,250 is forced to pay for their own care.
Recent reforms to raise this financial bar to £75,000 – in line with Oxford economist Andrew Dilnot’s recommendations – will not take effect until 2016.
Sean McCann, head of life technical and marketing compliance at NFU Mutual, said: ‘Younger generations could be in for a long wait if they are banking on an inheritance to fund their own retirement.
‘People should be making their own retirement plans rather than factoring in property and wealth that could be whittled away by the cost of care.’