If you are very lucky, you will spend your retirement years within your own four walls, but not everyone is that fortunate. Una McCaffrey examines the options, availablity and cost of long-term care

When it comes to making plans in life, the closest most people come to thinking about retirement is the decision to put some money into a pension. Even then, it is hard to work up any enthusiasm - these are, after all, relatively dull products that will swallow years of hard-earned contributions before the slightest financial benefit can be felt.

One subject that makes even pensions look exciting, however, is the question of where one expects to live in one's so-called "golden years" - a topic highly unlikely to feature in many witty dinner-party conversations.

Unpalatable as it may seem, it is, like so many of life's other seemingly distant issues, very likely to be your problem one day. In the Dublin area alone, it has been predicted that the number of over-65s will grow from around 105,000 now to 250,000 in 2031. That means you, if you are in your mid-thirties now.

If you are very lucky, it will simply be a matter of staying where you are, living within your own four walls in a familiar neighbourhood, without any great need for outside care. But not everyone is that lucky.

This fact, when combined with the aforementioned demographic developments, suggests that most of us will, at some stage in our lives, need to consider the long-term care of either ourselves or a relative.

It is all very well to have a vision of a luxury home equipped with servants to cater for our every retirement need (it worked for the British Queen Mother), but we also need to consider how exactly we are planning to finance this old-age life of comfort.

Given that staying in a comfortable private nursing home for a week currently carries a charge not incomparable to that attached to a week of luxury hotel accommodation, there is no doubt that the issue of money looms large when it comes to long-term care. If you fancy residing in the classiest nursing home, for example, you could expect to shell out as much as €800 per week for the pleasure.

With figures like this commonplace, it is no surprise that long-term care for the elderly is big business in the Republic, a situation evidenced by last month's news of €80 million being invested in a string of nursing homes in various Irish locations by Danish/Irish group First Citizen Residential.

The issue is also a reasonably hot political potato, particularly on the funding front. The Minister for Health and Children, Mr Martin, has, on more than one occasion over the past few months, been asked to clarify the situation with regard to the financing of nursing home beds.

He has repeatedly referred to an ongoing review of the nursing home subvention scheme, the system whereby the Government makes part contributions to the nursing home costs of individual residents (see panel). As yet, however, no review has been completed. Equally, a study on the financing of long-term care that was last year commissioned by the Department of Social, Community and Family Affairs is still a work in progress, despite being originally planned for completion last summer.

All of this movement (or lack thereof) leaves individuals who currently require long-term care in a slightly confusing state. The result is that entering long-term care can put emotional as well as financial pressures on elderly people and their families.

In basic terms, older people who can no longer live alone are faced with three main accommodation options, although not every individual will be eligible for, or will require, all.

The first alternative is sheltered housing, a system suited to people who are still in a position to care for themselves in an independent setting but who like the idea of being supported by an appointed body. Individuals who qualify for a place on the housing list can apply to live in sheltered accommodation operated by their local county council, with each authority applying a set of criteria to potential residents.

In practice, however, only low-income pensioners are likely to qualify, leaving middle- and high-income pensioners to seek alternatives.

A variation on the theme is private sheltered accommodation, such as that run by the charitable Sue Ryder Foundation (see second story). Such schemes vary according to provider, with different criteria applying in each case. In general, however, residents will have a reasonable level of financial self-sufficiency and will not qualify for State support outside a pension.

The next step is to enter the residential home system, a route suitable for people who do not need long-term medical care, but choose to abandon independent living in favour of a degree of supervision.

The final and most expensive option is the nursing home - the subject of much negative publicity in the past couple of years. Here, medical attention will be provided by qualified personnel, with the level of that attention varying from home to home.

It is at this level that financial issues really come to the fore although, in theory, any person in need of nursing home care has a statutory entitlement to be provided with that service by their local health board.

Pensioners on low incomes who qualify through a means and care test will not need to pay anything more than their pension for this care since it will be provided in a public nursing home. If a place in such a home is not available, a bed in a private nursing home may be "contracted" by the health board. In either case, a resident must be left with some "pocket money" from their pension.

For the rest of the population, the story is not so simple.

If an elderly person has reasonable means and property to their name, they could face paying for all of their long-term care in a private nursing home. The circumstances in which a subvention will be awarded are reasonably narrow, with the result that many elderly people are faced with rooting through their own finances in order to support their suddenly expensive lifestyle.

With this in mind, the Minister for Finance, Mr McCreevy, last year introduced a system of tax relief for long-term care insurance. In theory, this would spur people towards making provision for their later years earlier than they would normally. In practice, however, a lack of such products on the Irish market has made such an effort next to impossible.

Another option for older people on the cusp of entering into long-term care is to cash in on the equity that they have accumulated in their properties. Both Bank of Ireland and Residential Reversions last year introduced products that allow elderly people to either sell a stake in their home or to mortgage a section of it.

Both providers have reported great success with the products, although lobby group Age Action advises caution in light of the potential for familial discord when the property comes to be bequeathed.

All in all, the issue of long-term care is one that is less than clear in a number of areas. No matter who gets elected on May 17th, it is unlikely that they will follow the example of the Scottish politicians, who recently voted to provide a system of free care for all elderly people, whatever their circumstances.

Such a system, and the clarity it offers, is, it seems, little more than a long-term prospect in the Republic.