“Advisers need to ensure they are adapting their businesses to cope with the needs of a growing number of older clients, some of whom might be vulnerable customers.”
Thinking about how to fund long-term care costs should also be a topic advisers urge their clients to discuss.
Tim Bennett, head of education at Killik & Co, reasons: “Forethought is especially important now that the pension rules allow for the inheritance of pension assets, which in some cases will be a sizeable chunk of someone’s total estate.
“With long-term care costs mounting all the time, thought also needs to be given to ensuring that sufficient assets are available to meet them and provide the level of care a client expects.”
The later stages of a client’s life can bring plenty of opportunities and possibilities, and there are often any number of financial decisions to be made.
In which case, what should take priority?
Is clients’ biggest concern avoiding inheritance tax (IHT), leaving a legacy or simply being able to pay for care costs and a funeral?
As Mr Bennett observes: “Each person will have different priorities. For example, not all clients are seeking to avoid IHT – some are happy to pay what they see as their fair share.
“Whatever their specific priorities, as a general rule, we would advise clients to ‘put their own life vests on first’ – planning for retirement and long-term care, for example, should not normally be relegated below providing for children and grandchildren.”
Known unknowns
As with most stages of life, there are plenty of uncertainties to contend with.
“Some will prioritise enjoying their money while they can, others will face unexpected expenses, such as long-term care, and some will be fortunate enough not to need their pension to support them in their old age,” Ms Tait notes.
“The financial plan needs to take this into account and adapt as necessary when things change.”
Clients’ biggest concern is usually the uncertainty inherent in end of life planning, according to Joe Roxborough, a chartered financial planner at Ascot Lloyd.
“Most plans we make in life – retirement, moving, having children or not – are under our control to some degree. Death, however, is both inevitable and unknowable,” he acknowledges.
But he thinks: “Avoiding IHT is probably the largest concern, along with its counterpart ‘how much is enough?’.
“Cash flow modelling and planning with other family members gives the client the best tools to visualise the future, both for themselves and for their descendants and, although nothing is guaranteed other than death and taxes, we can at least create the best plan possible, which is better than no plan at all.
