The price of not planning for care costs in the UK

For individuals with assets above £23,250, care is typically self-funded. This threshold brings a significant proportion of the population into scope.

Once that line is crossed, the responsibility for funding care sits squarely with the individual and their family. There is no simple safety net, and the costs can be substantial.

Average residential care fees are now in the region of £66,456 per year. For nursing care, that figure rises to £82,888. These are not short-term expenses. For many, care extends over several years, creating a material and sustained financial commitment.

In 2022/2023, there were 441,479 care home residents in the UK. Of those, 37% paid for their own care. This is not a niche issue affecting a small group of individuals. It is a mainstream financial challenge that sits alongside retirement planning, inheritance planning and long-term wealth preservation.

Despite this, it remains one of the least actively planned areas of personal finance.

In most cases, the issue is not awareness. People generally understand that care may be required at some point. The difficulty lies in translating that awareness into action.

There are several reasons for this.

First, care planning is inherently uncertain. Unlike retirement, which has a clearer timeline and structure, care needs are unpredictable. The type of care, the timing, and the duration are all unknown. This uncertainty can make it difficult to know where to start.

Second, it is an emotional subject. Planning for care often involves confronting the possibility of declining health, loss of independence or the need for support from others. These are not easy conversations, and they are often postponed.

Third, the system itself is complex. The interaction between personal assets, state support, local authority thresholds and care provision is not straightforward. For many, it feels easier to defer engagement than to navigate a system that appears opaque and difficult to interpret.

The consequence of this delay is that planning tends to happen late, often at the point where care is already required.

When decisions are made late, they are rarely optimal.

Families may find themselves needing to arrange care quickly, with limited time to explore options or understand the financial implications. In these circumstances, decisions are driven by urgency rather than strategy.

This can lead to:

• accessing funds in a way that is not tax efficient
• overlooking available allowances or funding support
• making short-term decisions that do not support long-term needs
• creating unnecessary financial strain or uncertainty

More broadly, it can affect the preservation of family wealth. Without a clear plan, assets may be used in a way that does not align with long-term objectives, including inheritance planning.

There is also a human cost. Making complex financial decisions during an already stressful and emotional period adds pressure for individuals and their families.

Planning for care is not about predicting the future with certainty. It is about creating a framework that allows better decisions to be made when the time comes.

This starts with understanding your current position. What assets are available? What income streams exist? How might these be used to support different care scenarios?

It then moves to understanding the options. Care at home, residential care and nursing care all carry different costs and implications. The availability of state support can vary depending on circumstances, and the interaction with personal assets needs to be clearly understood.

The goal is not to fix a single outcome in advance. It is to build flexibility, so that when decisions are required, they are made with clarity rather than guesswork.

One of the most effective tools in later life planning is cashflow modelling.

By projecting different scenarios, it becomes possible to understand how long assets may last under varying levels of care need. This can include modelling the cost of home care versus residential care, changes in income, and the impact of different funding approaches.

This provides a level of visibility that is otherwise difficult to achieve. It allows individuals and families to see the potential financial implications and to test different strategies before decisions are made.

Importantly, it shifts the conversation. Instead of asking “can we afford this?”, the focus becomes “what approach gives us the best outcome over time?”.

This does not remove uncertainty, but it provides structure. It allows for informed choices, rather than reactive decisions.

Care planning sits at the intersection of multiple disciplines. It involves financial planning, tax, investment strategy, estate planning and, often, family dynamics. It also requires an understanding of the care system itself, including funding rules, local authority processes and the practical realities of care provision.

This is not an area where general advice is always sufficient.

For that reason, there is a clear benefit in working with a specialist, such as a Financial Planner accredited by the Society of Later Life Advisers (SOLLA).

The SOLLA accreditation is designed to identify advisers who have specific expertise in later life planning. This includes not only technical knowledge, but also an understanding of the practical and emotional aspects of advising older clients and their families.

A SOLLA-accredited adviser is equipped to navigate the complexities of care funding, explain the available options in a clear and practical way, support families through sensitive decision-making, and coordinate planning across financial, tax and estate considerations. In a complex and often unfamiliar area, that level of specialist support can make a meaningful difference.

Effective later life planning is rarely a single decision. It is a process that evolves over time.

A structured approach typically involves:

• understanding current financial position and objectives
• identifying potential care scenarios and associated costs
• reviewing available funding options and support
• modelling outcomes through cashflow planning
• putting in place a flexible strategy that can adapt as circumstances change

This approach allows for decisions to be made in stages, rather than all at once. It provides clarity at each step, reducing uncertainty and allowing families to move forward with confidence.

The gap between expectation and preparation in later life is clear, and its consequences are significant. Despite the growing likelihood and cost of care, most people delay planning, leading to sub-optimal financial outcomes and added emotional strain for families.

Alongside financial planning, it is important to ensure that wider arrangements are in place to support later life decision-making. This includes having an up-to-date Will and Lasting Powers of Attorney, as well as working in conjunction with other professionals such as legal advisers to ensure plans are aligned. A coordinated approach helps to avoid gaps, reduce risk and ensure that decisions can be made effectively if circumstances change.

A more proactive, structured approach that is supported by cashflow modelling and specialist advice can transform this experience. By engaging earlier, individuals gain clarity, flexibility, and control over future decisions.

Ultimately, effective later life planning is not about certainty, but about being prepared to make informed choices that protect both financial wellbeing and family peace of mind.

At Old Mill, our later life planning team includes advisers accredited by the Society of Later Life Advisers (SOLLA), bringing specialist expertise to what is often a complex and sensitive area.

We work with individuals and families to provide a clear, step-by-step approach to later life planning, including care funding, financial structuring and long-term cashflow modelling. Our aim is to help clients make informed decisions with confidence, at a time when it matters most.

An initial conversation is available without charge, offering the opportunity to explore your position and understand the options available to you.

Simon Valentine-Marsh is a Chartered Financial Planner at Old Mill and a Society of Later Life Advisers (SOLLA) accredited member. If you would like further advice from Simon and our specialist team for later life care, get in touch.