How to prepare for a longer life
Life expectancy is on the rise, according to new analysis. Not only are people likely live longer globally, but the gap between male and female life expectancy is closing. With a longer life expectancy comes a growing elderly population, which means more people that need to make use of health and social care services.
With these services already being pushed to the limit, it pays to have a plan in place for old age. It’s never too early to start thinking about provisions for later life, and it is also important to speak to our parents about their plans for care and support so that you know how to support them when the time comes. It’s important that we take more responsibility for our own care and support needs, as there is no guarantee of help from the state. Also, we recently covered the sentiment that children should help their parents more in old age, looking after them and helping to ensure that their needs are met.
It’s easy to assume that our care and support needs will be met when we’re older, but this isn’t always the case. It’s hard to get financial support from the local authorities, as they are on tight budgets and the criteria for getting help is set at a high level. It’s therefore likely that you will be self-paying for your requirements in the early stages of older age, and this means having some money available to cover this. Even if you do qualify for local authority funding, you may wish to top up what you receive to get a better service or have more choice over the care and support you receive. As soon as you can, start paying into a pension and this will build up over your working years to deliver an income in later life. You can also start saving money in an ISA or similar, so that there is a lump sum of cash when needed. Chat to a financial advisor about the best ways to invest funds early to give the most reliable return in later life.
If you or your parents are already approaching the need for care services, then there are options, such as an immediate need care fee payment plan, which a lump sum can be invested into in return for a guaranteed income, which could help to cover long-term care costs. Releasing the equity in your home or downsizing can also help to release funds when needed, but think carefully and explore all the options before selling your home to pay for care. Most people prefer to stay at home for as long as possible and use homecare services. The Money Advice Service has some great advice on self-funding long-term care.
It’s not just about being financially prepared either. It’s also good to have a preferred care plan in place. When approaching retirement, or if you parents are, then it’s important to have a chat with family about your/their choice of care and support services. It’s not an easy conversation to have, but sometimes things happen and quick decisions about care need to be made, and often by family members. If everyone knows your/your parents’ preference, it is easy to make those decisions. We have a more detailed article looking at discussing care needs with your elderly parents on the website, but the questions here apply to making your own care plan too.
The key message is to make a plan now, no matter where you are in life. It gives peace of mind and leaves you free to enjoy your life without worrying about how you will cope when you’re older.