Evidence suggests that unpaid carers – the number of whom increased by 4.5 million at the height of the pandemic to 13.6 million, with one in seven likely to be of working age – are showing signs of getting ahead of the game with regards to proactive planning for their loved ones’ care needs, as opposed to simply reacting at the point of crisis.
This is encouraging news, not only for carers’ mental health, but also for their financial wellbeing. Average care costs can be £40,000 – £60,000 a year and a quarter of people end up running out of money; a figure that increased by a third (37%) during the pandemic.
This year, with the cost-of-living crisis, carers have faced unprecedented pressure on their finances. Carers UK found that a quarter of carers (25%) said they were cutting back on essentials, such as food or heating, and over three quarters (77%) said that the rising cost of living is one of the main challenges they will face over the coming year. Over half of carers (63%) said they were extremely worried about managing their monthly cost.
Working carers planning ahead more
Against this backdrop, Tracey Funnell, Business Manager for Legal & General Retail Retirement Income’s Care Service, says their data shows that awareness of the need to plan ahead when it comes to anticipating the future care needs of loved ones seems to be increasing. Previously, the Care Service found that expert help with care needs and funding requirements tended to be accessed at the point of crisis; the day an elderly relative is released from hospital, for example.
However, Tracey says they now find that over half (54%) of calls in to their Care Concierge service – access to care experts included as part of Legal & General’s Group Income Protection products – were from those investigating care on behalf of loved ones who were not in immediate need of care services.
Tracey explains that discussing care options at an early stage can help loved ones to stay independent for longer and, where relevant, these conversations can lead to discussions about care funding and individuals being signposted to independent financial advisers who specialise in later life care.
She adds: “This kind of advance planning represents a significant change. And will hopefully go some way towards addressing the fact that far too many self-funders end up running down their savings to almost nothing.”
So, what’s prompting this proactivity? The answer to that is unclear. Maybe it’s because the issue of accessing and funding social care has been in the media spotlight of late, as a result of the government announcing a delay to social care reform. Maybe it’s because many unpaid carers were able to do more to help loved ones during the various Covid-19 related lockdowns and working from home; these commitments now becoming ever more challenging due to new ways of working. Or perhaps it’s because employers are doing more to support their working carers.
One thing’s for sure, supporting and retaining employees with caring responsibilities remains a critical workforce issue, with working carers facing unparalleled pressures.
A brief lowdown: Social care reform
For example, the current issue for self-funders goes like this. Currently, if an individual has assets above the £23,250 means test threshold they will have to pay for care themselves, rely on family or friends or go without care. This threshold still applies if they’re assessed as needing care in their own home, but the value of their home is no longer taken in to account).
If they do pay themselves, there’s no limit to how much they might have to pay over their remaining lifetime. The average cost of a care home in England is around £35,000 a year and some people spend many years in care. In 2011, the Dilnot Commission estimated that 1 in 10 people might have to pay more than £100,000.
So, how will social care reform change things? Instead of having to pay for all their care if their assets are above £23,250, it is proposed that from October 2025 an individual would only pay for all their care if their assets were more than £100,000. Also there will be a limit – a cap – on how much they are expected to pay over their lifetime. This cap is due to be set at £86,000 (but it comes with various caveats). Once an individual reaches that amount, the government would contribute towards their care related costs.
And the impact on employers and employees? A recent report said that even with the new level of funding proposed by the government – and recognising some of the caps and limitations on the levels of support available – there will be millions of UK workers underserved. The report identified that an increasing number of staff with caring responsibilities and the rising average life expectancy are creating issues in the workplace, impacting absence, productivity, employee health, diversity and inclusion and retirement.
Here are three ways in which employers can help:
- Follow best practice. Carers Trust provides some useful information, on the practical steps employers can take to support working carers, including signposting to other useful resources.
- Make better use of employee benefits. Look into what’s available at no extra cost as part of existing employee benefits. Group Income Protection, for example, might include support for carers, such as direct telephone access to care experts who can help individuals navigate the state funding system, NHS and social care services, plus discuss care options. Employee Assistance Programmes (EAPs) also provide access to legal and financial information, plus accredited counsellors for help with everyday mental health support, including personal debt management.
- Provide unbiased signposting to specialist independent financial advice. Such signposting might be provided already where the above services are provided. If not, it’s worth speaking with the Society of Later Life Advisers (SOLLA), for example, to find out about signposting to their Find an Adviser service to locate a local independent adviser who can help. All the advisers listed have successfully achieved Later Life Adviser accreditation and can provide advice on funding vehicles such as immediate needs annuities or equity release.
Vanessa Sallows
Vanessa Sallows, Group Protection Claims & Governance Director at Legal & General has over 30 years' experience working in the NHS, private industry and the protection market. Vanessa has responsibility for the claims and rehabilitation teams and oversight of the medical underwriting philosophy within Legal & General's Group Protection business. Vanessa is passionate about the psychology of work, what prevents individuals from working during periods of ill-health and helping people return to 'good work'.
