Men are far more likely to be able to use a personal pension to pay for care than women are, research from Canada Life has found.
The research, carried out by Opinium among 2,000 UK adults, found a significant savings gap when it comes to people's expectations of how they anticipate paying for long-term care, and their actual ability to pay for it.
Almost two-fifths (37 per cent) of UK adults over the age of 60 said they would use the state pension of just £179.60 per week to contribute towards the costs of care.
This is an increase of 16 per cent, compared to when Canada Life asked the same question last year. When extrapolated to reflect the UK population, this would make up approximately 6.3m people aged 60 and above who think the state pension will suffice.
With the average cost of a care home estimated at between £600 and £800 per week, according to Age UK, the 6.3m people in the UK aged 60 and above will need to find an additional £400-£600 a week to afford care, Canada Life warned.
However the gender breakdown was even more revealing.
While only 12 per cent of women expected the government to cover the cost of care, compared with 18 per cent of men, women were marginally more hopeful that their state pension entitlement would be enough to cover any long-term care bills (at 38 per cent, compared with 36 per cent of men).
More worryingly, when it came to their personal pension, a mere 14 per cent of women thought they would be able to rely on it to pay for care, compared with 25 per cent of men (see table).
Survey question: How will you pay for care?
|Use state pension||36%||38%||37%|
|Use cash savings||37%||34%||35%|
|Use private pension||25%||14%||19%|
|I have not planned that far ahead yet||17%||17%||17%|
|I expect the Govt to cover the cost of care for me||18%||12%||15%|
|By selling assets (ie. My house)||10%||12%||11%|
|By releasing equity from my home||8%||8%||8%|
|Using stocks and shares||9%||6%||8%|
|I don’t need to worry about paying for care later in life||6%||3%||5%|
|By renting out my property||4%||4%||4%|
|Using inheritance I have received/ will receive||2%||4%||3%|
|By moving in with family to minimise costs||3%||2%||2%|
|Using a financial gift from family members||0%||0%||0%|
|N/A / I don’t know||24%||23%||23%|
|Prefer not to say||4%||3%||3%|
Source: Canada Life
According to Alice Watson, head of marketing for insurance at Canada Life, the findings point to the urgent need to help people get retirement ready and to make them aware of the rising cost of long-term care.
She said: “As a society we continue to grapple with the issue of long-term care and who pays for it.
"Recent rumours suggested the government is looking to increase national insurance to help fund the NHS and pay for social care, but there is no doubt there is a big funding gap.
“We must continue to encourage people to think about their wants and needs at the different stages of retirement and have these conversations early on, no matter how daunting they may be."