• Moving into residential care costs five times more than home care
• Retired homeowners hold £700 billion of equity in their homes which can be used to help pay for care SHIP (Safe Home Income Plans) – the body championing high standards of delivery from UK equity release providers – reveals that although the cost of care is soaring, there is a solution for older homeowners.

The cost of care in retirement can be very expensive, with the average annual cost of residential care in a home costing an average £32,000[1].This stands at five times more than the average annual cost of receiving care in the home, at £6,846[2].

The average pensioner has an income of £13,884[3], rendering both care choices expensive. 450,000 older people in need of care currently face some kind of shortfall in the formal support that they receive[4] with 150,000 currently purchasing care at home privately[5].This gap has lead to the growing care at home market being worth £51.91 billion[6], a market that has to be funded the British pensioner’s already overstretched finances.

Andrea Rozario, Director General of SHIP said:

“As their likelihood of needing private care increases, pensioners must consider how they would fund any care needed. Recent Governmental figures have announced the total of £700 billion[7] tied up in home ownership by those in retirement; schemes such as Equity Release can provide a regular income in return for equity in a property. By taking out a lifetime mortgage or by selling part of the property in exchange for a regular income or a lump sum using a home reversion plan, pensioners can ensure that any domiciliary care costs are covered without a negative impact on their retirement finances.”