Money and an ageing population

Latest population projections show that by 2050, one in four people in the UK will be aged 65 or over[1]. This would represent an increase from one in five in 2018. This trend is the case across much of the world as the impact of declining fertility rate combines with longer life expectancy to shift the age distribution of the overall population towards the older ages. You could be forgiven for the assumption that this is would be a bad thing, that an increasingly elderly population is going to be a burden on the economy and on health and welfare provision. But this is increasingly not so.

Working in later life

The Office for National Statistics (ONS) figures show that growth in economic activity at older ages has been greater than growth in other age groups, this means that more people are working beyond age State Pension Age (SPA). Most of this growth is due to increasing numbers of women in the workforce, especially at older ages and working part-time. While this might be in part due to improvements in healthy life expectancy, the increase in women’s SPA from 60-65 in the last ten is likely to have contributed to this change as well as the scrapping of the default retirement age which forced workers to retire at 65. 

This trend is a challenge for employers as they adapt to provide benefits packages and working patterns to suit their changing workforce. As well as training opportunities being valued by older workers, flexible working patterns and health and wellbeing benefits become increasingly relevant and popular.

Families and later life

As we grow old some of us have managed to accumulate savings and pension pots, many will own their own homes and be mortgage-free. But this is not the case for everybody. In fact, as our ability to work for a living is reduced by the physical and mental effects of the ageing process, so many find later life to be a struggle to make ends meet. The Financial Conduct Authority (FCA) has been so concerned with the particular issues of ageing and finances that it commissioned research and published a paper in late 2017[2].

The FCA paper highlights a number of important considerations for both policymakers and businesses to be aware of. Two of which stand out as areas in which families can take steps to make things easier in later life:

  • Third party access – enabling trusted loved ones to make decisions and take actions on your behalf if you were unable to do so yourself.  An important means of doing this is via Powers of Attorney, which formalise who can act for you and how.  See our previous blog for more information.

  • Long term care – the requirement for nursing care or help with daily tasks later in life. The provision of and funding for state help in this area varies widely between local authorities. Friends and family may be able to help but paying for care over and above what they can provide could be a real financial burden. See our Care Funding Factsheet for more information.

Start the conversation

The first step to ensuring that we and our older relatives can have the most comfortable later life possible starts with a conversation about death, ill health and money matters. This can be difficult as we live in a society that dislikes conversations about these things, but it’s important that we do. In speaking to our nearest and dearest we can start to understand each other’s priorities and the take steps to protect what’s important to us later on.


[1] Living longer and old-age dependency – what does the future hold? ONS article, 24 June 2019.

[2] Financial Conduct Authority, Occasional Paper 31, September 2017.

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