Financial Planning in Later Life: A Guide for Your 70s and 80s

The financial planning needs of someone in their 70s and 80s are fundamentally different from those in earlier life stages. The focus shifts decisively from building wealth to deploying it: generating reliable income, managing longevity risk, planning for the possibility of care costs, and ensuring that assets pass smoothly to the next generation. Complexity becomes an adversary rather than a tool.

This guide is written for individuals in later life and for those who advise them — including family members who may increasingly be involved in financial affairs. It covers the key themes that dominate financial planning in the 70s and 80s. It does not constitute financial or legal advice, and professional advice should always be sought for individual circumstances.

Shifting the Investment Objective: Decumulation

For most people who reach their 70s with capital, the investment goal shifts from growth to income and capital preservation. The emphasis in the investment portfolio changes:

Natural income over capital growth: rather than relying on selling assets to fund expenditure (capital drawdown), many later-life investors prefer to structure their portfolio to generate the income they need from dividends, interest, and rental income. This reduces the need to make sale decisions, which require active management and can be distressing in volatile markets.

Volatility reduction: later-life portfolios typically carry less equity risk than accumulation portfolios. A significant stock market fall in your late 70s, combined with ongoing withdrawals, can permanently impair a portfolio. The "sequence of returns" risk is most acute when withdrawals are high relative to the portfolio.

Liquidity: the portfolio should hold sufficient liquid assets to fund several years of expected expenditure without requiring sales in unfavourable market conditions. Illiquid investments — private equity, some alternative assets — are generally unsuitable unless you have a clear exit timetable.

Simplification: a portfolio accumulated over decades often contains legacy positions — shares from company share schemes, inherited property, a proliferation of ISAs and pension pots. Consolidating and simplifying reduces administration, makes estate planning clearer, and reduces the risk of overlooked assets.

Simplifying the Estate: Practical Considerations

The administration burden of a complex estate can be substantial — both for the individual and for their executors. Practical simplification steps include:

• Consolidating bank accounts: multiple current and savings accounts at different banks increase vulnerability to fraud, complicate reporting, and create administration for executors. Consolidating to the minimum necessary is prudent.
• Closing dormant accounts: many people have dormant accounts, unit trusts registered under old addresses, or premium bonds accumulated over decades. Tracing and closing these assets while you are alive is much easier than the executor doing it posthumously.
• Reviewing share certificates: physical share certificates for legacy positions should be dematerialised and transferred to a nominee account.
• Updating beneficiary nominations: pension death benefits, insurance policies, and some investment accounts pass outside the will to named beneficiaries. These nominations must be reviewed and kept current.
• Ensuring the will is up to date: a will drafted in your 40s may no longer reflect your circumstances, family composition, or asset base. A will review should be a regular exercise, not a once-in-a-lifetime event.

Care Cost Planning

The average cost of residential care in England is approximately £35,000–£50,000 per year; nursing care can exceed £60,000. These costs can rapidly deplete a wealth base that was intended to pass to children. Planning for care costs is uncomfortable but essential.

State provision: local authority care funding is means-tested. In England (as at 2026), individuals with assets above approximately £23,250 are expected to fund their own care. Assets below approximately £14,250 are fully disregarded. Between these thresholds, a tariff income is applied. Capital includes most assets, but notably not the family home if a spouse, civil partner, or dependent relative continues to live in it.

The care cost cap (abandoned): a lifetime cap on care costs (£86,000) had been due to take effect in October 2025, but the government scrapped these reforms in July 2024. As at June 2026 there is no cap on care costs, and the means-tested system remains in place; the Casey Commission is reviewing longer-term social care reform. Professional advice is essential for up-to-date information.

Care annuities: an immediate needs annuity (also called a care annuity or care fees annuity) is an insurance product that pays a regular income for life, guaranteed to cover a specific care home fee. It is purchased with a lump sum and is specifically designed for those who already need care. Because payments are made directly to the care provider, they are free of income tax. These products provide certainty about care funding but are not suitable for everyone.

Equity release: a lifetime mortgage can release capital from property to fund care costs, if the individual can continue to live at home with care support. However, equity release significantly reduces the estate passing to heirs and should only be considered after taking regulated advice.

Cognitive Decline: Planning While You Still Can

The importance of planning for cognitive decline cannot be overstated. Alzheimer's disease and other forms of dementia affect over 900,000 people in the UK, and the prevalence rises sharply with age. Planning steps that are straightforward while you have full capacity become impossible once capacity is lost.

Lasting power of attorney: an LPA for property and financial affairs, made while you have capacity, allows a trusted person to manage your finances if you lose capacity. Without an LPA, the family faces a Court of Protection application — expensive, slow, and distressing. Anyone who has not yet made an LPA should do so promptly.

Health and welfare LPA: a separate LPA covers health and welfare decisions, including medical treatment and care arrangements. Both types of LPA should be in place.

Reviewing the LPA as circumstances change: if your attorney has died, moved abroad, or you have fallen out of contact with them, the LPA must be updated. A sole attorney who predeceases you leaves a dangerous gap.

Simplifying investment management: as capacity declines, discretionary investment management (where the manager makes decisions within agreed parameters without needing to consult you for each transaction) becomes more appropriate than advisory management (where you must approve each transaction). Review your arrangement with your investment manager.

Advance directive: a formal advance decision (advance directive) allows you to record medical treatment preferences while you have capacity, for situations where you may lack capacity to decide in the future. This is separate from an LPA but complements it.

Digital Legacy

An increasingly significant aspect of later-life planning is the "digital estate" — email accounts, social media profiles, online banking, cryptocurrency holdings, cloud storage, and digital purchases. Without planning, this estate can be inaccessible or permanently lost after death.

Practical steps:

• Maintain a secure, up-to-date record of digital accounts, usernames, and access information — stored in a safe location accessible to your executor.
• Consider a password manager and share the master password with a trusted person.
• Specify in your will or in a letter of wishes what should happen to digital accounts. Some platforms (Facebook, Google) allow nomination of a "legacy contact" to manage the account posthumously.
• Cryptocurrency held in a hardware wallet or cold storage with no recorded seed phrase may be permanently inaccessible to heirs. Document access carefully.

Investment Review: Later Life Checklist

• Have you reviewed your portfolio's income generation versus your current expenditure needs?
• Is the portfolio appropriately diversified without excessive complexity?
• Are there legacy equity positions that carry a large capital gain and have not been reviewed for years?
• Is there a cash reserve sufficient to fund 2–3 years of expenditure without selling investments?
• Are your LPAs in place, registered, and up to date?
• Have you reviewed your will in the last 5 years?
• Are pension death benefit nominations current?
• Do you have a plan for potential care costs?

How Global Investments Can Help

Global Investments provides later-life financial planning advice to individuals, families, and deputies acting under lasting powers of attorney. We help clients simplify and restructure portfolios to meet late-life income needs, assess the suitability of care annuities, and coordinate with solicitors and care advisers on LPA and capacity planning.

We also assist attorneys acting under registered LPAs with their investment management obligations, providing the documentation and governance they need to satisfy family, co-trustees, and, if necessary, the Office of the Public Guardian.

This guide is for general information only and does not constitute financial, legal, or care advice. Individual circumstances vary greatly. Always seek professional advice before making financial decisions in later life. The value of investments and income from them can fall as well as rise. Capital is at risk.