Singapore is facing a "silver tsunami" with a rapidly ageing population, highlighting the urgent need for long-term care solutions. Young families in particular face a complex challenge where they must care for their ageing parents while considering their own long-term care needs. Government initiatives like ElderShield and CareShield Life help to alleviate some of these concerns with coverage for severe disabilities that provide a degree of financial protection for families.

This article sheds light on the topic with findings from a Singlife study that surveyed 1,005 Singaporeans and PRs on their perceptions of disability and concerns around long-term care financing.

9 in 10 believe being severely disabled could cause financial and emotional problems, but only 6 in 10 have made financial plans for long-term care.

While contemplating severe disability may be uncomfortable, the reality is that one in two healthy Singaporeans aged 65 could potentially experience severe disability in their lifetime¹ and require long-term care. The good news is that the majority of respondents in Singlife's Long Term Care Research 2024 Study are aware that severe disability could lead to financial and emotional challenges. However, this awareness doesn't always translate into action as only slightly more than half have made financial preparations for managing the cost of long-term care.

This could be because young families often prioritise growing their wealth for early retirement or saving for their children's future. However, it's important to consider that these savings could be significantly impacted by unexpected long-term care costs in the event of severe disability.

The average cost of long-term care is S$2,952 per month.

To manage severe disability, individuals often need to make significant life adjustments which will add to their costs. According to the study, these may include ongoing expenses such as medication (S$391), specialised transportation (S$166) and personal care services (S$430), as well as one-off expenses such as home modifications (S$369)⁴.

At S$2,952 per month, the average total cost of long-term care exceeds the monthly payout of S$649 from CareShield Life in 2024. Families can consider purchasing a supplement plan that provides additional payouts to bridge this gap and ease their financial burden.

2 in 3 are concerned about being a burden to loved ones. However, in reality, 59% of caregivers report they are dipping into family members’ personal savings to help finance long term care.

While no one wants to burden their loved ones, the 4.5%² healthcare inflation rate in 2023 presents challenges for families trying to manage their long-term care needs. More than half of caregivers in Singlife’s study reported dipping into personal resources to provide essential support for their loved ones. Doing so might deplete funds intended for the family’s other needs such as rental, utilities, school fees and medical fees. This emphasises the importance of planning and securing adequate financial protection to alleviate the burden on caregivers and ensure comprehensive care for those in need.

Young families should integrate their long-term care needs as part of their financial plans early. As each family is different, it’s important to consult a financial adviser representative to find a plan that is right for them.

24% prefer to stay at a nursing home and 27% prefer to have a qualified nurse to visit every day. However, caregivers report that the most common type of long-term care is a family member taking care of their loved one at home.

While many prefer to be cared for in a nursing home or by qualified nurses, these options may be expensive. According to the Agency for Integrated Care Singapore, the basic cost of staying at a nursing home varies between S$2,200 and S$4,200³ (before MOH subsidy). Getting a trained caregiver from a platform like Homage is slightly more affordable starting from S$24 per hour for a weekday visit. However, these costs can stack up over the course of a month.

According to the Singlife study, people typically underestimate the actual cost of nursing home services by 6%⁴. This concern with this is that when people don’t realise how much they’d need for the services they want, they may be under-resourced to pay for it. Indeed, as the study further shows that in most cases (41%) where care is needed, the individual ends up relying on a family member for their long-term care.

Staying home to take care of a severely disabled family member, be it your spouse, your parent or even your grandparent, child or sibling can be challenging especially for young families. Juggling between caregiving, a career and looking after children can be overwhelming. To better support families in their caregiving efforts, platforms like Singlife Care Collab act as a one-stop hub for easy access to a range of support services from trusted partners like SG Assist, IHH Healthcare and more.

The top reason cited for not purchasing long-term care insurance is that it’s unaffordable but plans like CareShield Life and CareShield Life supplements are fully payable by MediSave.

While most respondents in the Singlife study have heard of CareShield Life, only half (56%) are familiar with how it works⁴. A key feature that most overlook is the fact that individuals can use their MediSave to fully pay for CareShield Life premiums for themselves and their approved dependants.

Young families can explore adding a supplement plan to enhance their CareShield Life coverage for themselves and their parents. These plans are payable by MediSave, up to an annual cap of S$600, and offer higher monthly payouts that can better support the cost of daily expenses. Depending on the plan you choose, there may also be other lump-sum payouts and features which can be extremely useful.

Are you ready to manage your long-term care needs?

Navigating long-term care in Singapore requires thoughtful planning and consideration, especially in the face of an ageing population and rising healthcare costs. Understanding the available government schemes like CareShield Life and ElderShield, along with supplemental insurance options can empower families to build a more secure financial safety net for greater peace of mind.

It's crucial for individuals and families to proactively assess their long-term care needs and insurance plans, and understand how to make a claim. Most people believe that the ideal age to start preparing for long-term care is 37 years old⁴ but that’s seven years later than the eligible age of 30, which might put you at a disadvantage. By taking pre-emptive steps today, you can be prepared for life’s uncertainties, knowing that you have sufficient care and support for yourself and your loved ones.  

^Notes

^{1. Source: CareShield Life, “Why do you need to plan for your future long-term care needs?”, accessed on 22 April 2024.}

^{2. Source: Singapore Department of Statistics, “Consumer Price Index”, accessed on 22 April 2024.}

^{3. Source: Agency for Integrated Care, “Nursing Home”, accessed on 22 April 2024.} 

^{4. Source: Singlife internal proprietary study on “Long Term Care Research 2024” (March 2024). Unpublished.}