For many people, financial protection is something they think about when buying a home, starting a family or taking on a large financial commitment.
But for others, protection can remain low down the list of priorities until something happens that makes the need for it suddenly obvious.
New research from the Financial Conduct Authority (FCA) highlights just how large this gap can be.
Its Pure Protection Market Study, published in September 2026, found that 58% of UK adults do not hold any pure protection product. Of those without cover, 59% had never considered their protection needs.
The FCA’s research also found that people who do not have protection often have understandable reasons for not buying it. Cost, other financial priorities and a belief that protection is unnecessary all feature prominently.
So what types of financial protection are available, what could happen if you do not have appropriate cover, and how can a mortgage or financial adviser help you decide what may be suitable?
The FCA’s consumer research provides some revealing answers.
Among people who did not hold any pure protection but had considered their protection needs, the most common reasons for not having cover were:
These findings suggest that the protection gap is not simply about people choosing not to insure themselves.
For some, the problem is affordability.
For others, it is a lack of understanding about what protection does, uncertainty about which policy they need, or simply not having considered the issue.
The FCA has identified particular groups that are disproportionately unprotected, including renters, self-employed and gig-economy workers, people on lower incomes and people with pre-existing medical conditions.
Financial planning often concentrates on what people want to achieve: buying a home, saving for retirement, investing or building up savings.
Protection deals with what could go wrong.
That can make it psychologically easier to put off. Yet a family’s ability to achieve its financial goals can depend heavily on what happens if an income disappears because of death or illness.
For example, someone might have spent years building a pension or saving for a deposit, but still have relatively little financial resilience if they were unable to work for a prolonged period.
There is no single protection policy that covers every financial risk. Different products are designed to respond to different circumstances.
Life insurance is designed to provide a payment if the policyholder dies during the period covered by the policy.
For people with a mortgage, partner or children who depend on their income, life insurance can help provide financial support following their death.
There are several types of life cover. Level-term insurance provides a fixed amount of cover over an agreed period, while decreasing-term insurance can be used to cover a liability such as a repayment mortgage as the outstanding debt reduces.
Some policies provide increasing cover, which is designed to help maintain the real value of the benefit over time.
There is also whole-of-life insurance, which is designed to pay out whenever the policyholder dies, provided the policy remains in force. It is generally more expensive than term insurance and can be used for specific estate and inheritance-tax planning objectives.
Critical illness insurance can pay a lump sum if the policyholder is diagnosed with one of the specified illnesses or medical conditions covered by the policy.
The precise conditions and definitions vary between policies, so it is important not to assume that every serious illness will automatically result in a payment.
A lump sum could potentially be used to reduce a mortgage, cover household expenses, pay for adaptations to a home or provide financial breathing space while someone recovers.
For many households, their biggest financial asset is not their house or pension – it is their future earning potential.
Income protection is designed to provide a regular income if illness or injury prevents someone from working. Policies typically cover around 50% to 65% of income, subject to the policy’s terms and limits.
Income protection can be particularly relevant to people who would struggle to meet their mortgage, rent and other essential expenses if their salary stopped.
The length of the deferred period – the time before payments begin – can also affect the premium. Common deferred periods include four, 13, 26 and 52 weeks. Generally, a longer deferred period means a lower premium.
Depending on your circumstances, there may also be other forms of protection to consider, including family income benefit, relevant life cover for certain employees, business protection and protection available through an employer.
Private medical insurance is different from the pure protection products examined by the FCA’s market study, but may also form part of a broader approach to financial resilience.
The important point is that protection should be considered in the context of your circumstances rather than as a list of policies everyone should buy.
There is no guarantee that an insurance policy will be needed. But the financial consequences of an unexpected event can be significant.
Consider what might happen if you:
Without appropriate protection, a household may need to rely on savings, investments, family support, benefits or other assets to meet its financial commitments.
That could mean using money intended for another purpose, delaying retirement plans or selling investments or property at an inconvenient time.
The key question is what would happen financially if the unexpected occurred, and how much of that risk could you reasonably afford to insure?
One of the biggest barriers identified by the FCA is cost, with 19% of people who had considered their protection needs but had no cover saying it was too expensive.
However, there is no meaningful single “typical” cost for protection insurance.
Premiums can vary significantly according to factors including:
Government-backed financial guidance site MoneyHelper says life insurance providing a meaningful level of protection can cost from a few pence a day, but stresses that premiums depend on individual circumstances and the amount of cover required.
For income protection and critical illness cover, costs can vary particularly widely because insurers assess the risks and benefits differently.
This is why comparing the monthly premium alone can be misleading. A cheaper policy may provide less comprehensive cover, have different definitions or exclusions, or offer a different level of benefit.
The FCA’s market study found that competition generally works well for existing protection customers and that there is a wide range of products available.
It also found high claims acceptance rates, with 98% of protection claims accepted in 2024, according to the FCA’s analysis of ABI data.
It can be tempting to search for the cheapest protection policy and assume that is the best option.
But protection is designed to respond to a future event that could have significant financial consequences. Therefore, the details of the policy really matter.
Two policies might have similar premiums but different:
For income protection in particular, the definition of incapacity can make a substantial difference to when a policy pays out.
It is also important to provide accurate information when applying. Insurers may check medical information when a claim is made, and inaccurate or incomplete answers can affect whether a claim is paid.
For many people, buying a home is the point at which protection becomes particularly relevant.
A mortgage creates a long-term financial commitment, while a household may also rely on one or two incomes to cover the mortgage, bills and everyday spending.
A mortgage adviser can therefore help you consider protection alongside the mortgage rather than treating it as a completely separate issue.
An adviser can help identify policies from different providers and compare the features, definitions and costs.
This can be particularly useful where policies are difficult to compare directly.
The FCA’s research found that 4% of people who had considered protection but did not have cover said it was confusing and hard to compare, while another 5% lacked confidence that they would choose the right product.
The amount of cover required will depend on your circumstances.
An adviser can help consider factors such as:
This can help avoid both under-insuring and paying for cover that may not be necessary.
Protection does not exist in isolation.
A broader financial plan might need to consider how savings, pensions, investments, mortgages and insurance interact.
For example, someone with a large emergency fund may be able to cope with a shorter period away from work, while someone with limited savings might place greater importance on income protection.
Similarly, employer-provided death-in-service benefits may reduce the amount of additional life cover required – although such benefits can disappear if you leave the employer.
A mortgage adviser or financial adviser can therefore help you consider the balance between what you need to protect, what you already have and what you can afford to spend.
Protection needs can change as your circumstances change.
It may be worth reviewing your arrangements after events such as:
It is also worth reviewing whether existing policies still reflect your needs.
However, cancelling an existing policy before replacement cover is fully established can create a gap in protection. Your age or health may also mean that replacement cover is more expensive or provides different terms.
Consider what financial commitments you have, what income your household relies on, what savings and employer benefits you already have, and what would happen if you could no longer work or died unexpectedly.
You may decide that you need additional protection, that your existing cover is sufficient, or that other financial priorities should come first.
A mortgage or financial adviser can help you understand the options, compare policies and consider where protection fits within your wider financial plan.
Get in touch with an adviser today to find out more.
Disclaimer: This article is for informational purposes only and does not constitute financial, tax, or legal advice. Tax treatment depends on individual circumstances and may change. Protection policies are subject to terms, conditions and exclusions. Whether a claim is paid will depend on the policy terms and individual circumstances. Always seek professional advice before making financial decisions.
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Financial protection is insurance designed to provide financial support if specified events occur, such as death, serious illness or an inability to work because of illness or injury. Common forms include life insurance, critical illness cover and income protection.
The main types include life insurance, critical illness cover and income protection. Other arrangements can include whole-of-life insurance, family income benefit and protection provided through an employer.
There is no legal requirement to have life insurance when taking out a mortgage. However, it can be important to consider how your mortgage and other household expenses would be covered if you died, particularly if someone else depends on your income.
Whether life insurance is appropriate depends on your circumstances. It can be particularly relevant if you have dependants, a mortgage or other financial commitments that could be difficult for your family to meet after your death.
Life insurance generally pays a benefit when the policyholder dies, subject to the policy terms. Critical illness cover pays a lump sum if the policyholder is diagnosed with one of the specified conditions covered by the policy.
Critical illness cover generally provides a lump sum following diagnosis of a specified condition. Income protection provides regular payments when you are unable to work because of illness or injury, subject to the policy’s definition of incapacity and other terms.
There is no standard price. Premiums depend on factors including age, occupation, health, smoking status, the amount of income covered, the deferred period and the policy’s terms.
This depends on factors such as your mortgage and other debts, household income, living costs, number of dependants, existing savings and other protection arrangements. A useful starting point is to consider what your family would need financially if your income disappeared.
Having a medical condition does not necessarily mean you cannot obtain protection. Depending on the circumstances, an insurer may offer cover at a higher premium, with exclusions or on different terms. Specialist providers may also be available.
The cost varies considerably. Life insurance can cost from a few pence a day according to MoneyHelper, but premiums for all forms of protection depend on individual circumstances and the level and type of cover required.
A mortgage adviser can help you consider protection alongside your mortgage and compare available policies. They can also help you think about how your mortgage, income, dependants, existing savings and employer benefits affect your protection needs.
It can be sensible to review protection when your mortgage or wider financial circumstances change. A new mortgage may alter the amount of debt you need to protect, while changes in income, family circumstances or employment benefits may also affect your wider protection needs.
Not necessarily, but it is worth considering how long your savings would last if you could not work or whether they would be sufficient to support your dependants after your death. Savings and insurance can play different roles in a financial plan.
You would generally need to rely on other resources if an event covered by protection insurance occurred. Depending on your circumstances, this could mean using savings or investments, relying on a partner’s income, reducing spending, selling assets or potentially struggling to meet financial commitments such as mortgage or rent payments.
Not necessarily. The level of cover, policy definitions, exclusions, claim conditions and other features can be just as important as the premium. Comparing policies on price alone may not show which policy is most appropriate for your circumstances.
Having spent several months collating data from vast numbers of claims, it’s about that time of year when protection providers start to release their claims statistics.
This is significant as the providers like to shout about the support they have given to thousands of clients through pay outs on Life Insurance, Critical Illness Cover and Income Protection policies in the previous year.
This made me think about the common misconceptions people often have about “insurance”, especially when it comes to protecting their financial well-being by utilising one of the polices above.
Our advisers at Fairstone do a great job of navigating clients through such conversations to ensure that, should they need it, there is substantial financial support available through some of the darkest days people can go through.
During these conversations we often get similar concerns raised so I thought this would be a good opportunity to correct some common myths and misconceptions.
Clients have often had an insurance policy of some kind in the past, whether that’s mobile phone cover, car insurance or holiday insurance and it’s common to have had a negative experience claiming on such polices.
However, this is where the financial protection side differs. Clients are paid out in the vast majority of cases due to the outstanding advice they receive, alongside a policy which is tailored to their needs.
Examples below are taken from our top 3 providers on claims paid for Life and Critical Illness cover in 2025:
At Fairstone we ran an exercise in 2023 across our top six protection providers to see how well we supported our clients through quality advice.
The figures were encouraging.
In 2023 alone, we helped over 200 families through their toughest times with policies we had written based on our advice.
This meant that through high quality advice we provided on financial protection, Fairstone clients and their families benefited from over £18m of payouts.
When we looked back over five years, we had supported our clients with over £90m of protection claims.
It’s clear that there are people who do have to face life’s biggest challenges, proven by the fact that just three providers paid out over £2.4bn of life insurance and critical illness claims in 2025.
The statistics behind these figures also show that people of any age can be affected by a life-changing illness or death.
The youngest person to make a critical illness claim was only 21 with the average age being 50. The same provider even paid out £6.8m in critical illness claims for children.
Nobody knows what the future holds and financial protection can take some of the worry away should the worst happen.
There is often an assumption that protecting your family comes at a high cost.
This assumption is normally based on people not understanding what is covered or how the policy works, with people often not realising what it can take to protect their lifestyles.
The average age of a first-time buyer is 36. To cover a 36-year-old male for £250,000, for 25 years to pay out in the event of his death could cost as little as £7.75 per month – roughly the cost of a large coffee from one of our favourite coffee shops.
To cover a female for the same amount and term, for life insurance and critical illness cover, could cost as little as £47.90 per month.
Statistics have shown us that more people insure their pets than they do themselves, but if that person isn’t protected well and the worst was to happen, how do they ensure their pets are covered?
For more information about financial protection and how it can support you and your family get in touch with an adviser today. It could be the best decision you will ever make.
YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE OR OTHER LOAN SECURED AGAINST IT.
Disclaimer: This article is for informational purposes only and does not constitute financial, tax, or legal advice. Tax treatment depends on individual circumstances and may change. A recommendation will be made only following a full assessment of your personal circumstances. Always seek professional advice before making financial decisions.
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Losing a loved one is never easy. Alongside the emotional impact, you are often faced with a long list of financial and administrative responsibilities, at a time when you are least ready to act.
It’s an issue receiving growing attention and many referring to it as ‘deathmin’ or ‘sadmin’.
Industry regulator the Financial Conduct Authority (FCA) recently announced a review into whether investment firms are doing enough to support bereaved customers, highlighting that many people continue to experience delays, confusion and poor communication following the death of a family member.
Hopefully this will see improvements across the process.
While no amount of planning can remove the pain of bereavement, putting the right arrangements in place can make life significantly easier for those left behind.
One of the most valuable gifts you can leave your family is organisation.
To help with this, here is a simple checklist of things to consider that can really help your family at a difficult time:
The Government also has some useful guidance for bereaved relatives which outlines the main responsibilities they face.
When someone dies, family members often have to navigate a range of financial matters, including investments, pensions, protection policies and inheritance tax considerations.
Working with a financial planner and solicitor can help ease the burden at what can be an overwhelming time.
As financial planners, we can help beneficiaries understand their options, liaise with providers and explain the implications of decisions before action is taken.
Ideally, if we can have these conversations with loved ones whilst they are still alive, it helps when the time comes.
They will be familiar with us, and this can help ease the process, as well as providing some valuable peace of mind that things will be taken care of.
We and other professionals are experienced at dealing with these issues sensitively and we always look to put the people before the paperwork.
Not all assets pass on in the same way. Here are some of the main assets which your beneficiaries may received – and how they receive them.
Life Insurance can provide valuable financial support to beneficiaries at a difficult time.
Depending on how a policy is arranged, the proceeds may be paid directly to a named beneficiary, into a trust, or to the deceased’s estate.
Policies written under trust can often be paid more quickly and may not form part of the estate for inheritance tax purposes.
In cases such as this, it is important to ensure policy trust deeds are in place and up to date.
ISAs can often retain valuable tax advantages for a surviving spouse or civil partner through Additional Permitted Subscription rules, but those benefits are not available to other beneficiaries.
The ISA funds pass to these beneficiaries without the tax efficiency associated with ISAs.
Pensions usually sit outside the Will and are typically distributed according to death benefit nominations and scheme trustee discretion. Keeping nominations up to date is therefore extremely important.
Usually, inherited pension funds can stay within a pension environment.
Theses can have different outcomes on death depending on ownership arrangements and the lives assured.
In the case of these assets, it is important where inheritance tax planning has been undertaken that beneficiaries understand how these assets are treated following death.
Understanding how these assets work can help beneficiaries make informed financial decisions during a difficult period.
Inheritance tax is already a major consideration for many families and proposed changes that bring pensions into scope for inheritance tax from April 2027 are likely to add further complexity to estate planning.
This makes reviewing existing arrangements and seeking professional advice more important than ever.
Whether you’re planning ahead for your family or facing the responsibility of administering an estate, our role is to provide guidance, support and reassurance when it’s needed most.
For more information on how we can help, get in touch with an adviser today.
Disclaimer: This article is for informational purposes only and does not constitute financial, tax, or legal advice. Tax treatment depends on individual circumstances and may change. The value of investments can go down as well as up and you may not get back the full amount you invested. Past performance is also not a reliable indicator of future performance. Always seek professional advice before making financial decisions.
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Bereavement planning involves organising your financial affairs, legal documents and estate so your loved ones can manage your affairs more easily after your death.
Planning ahead helps reduce stress, avoids unnecessary delays and ensures your wishes are understood. It can also simplify the administration of your estate and minimise potential tax issues.
A good checklist should include an up-to-date Will, current pension death benefit nominations, details of financial accounts, insurance policies, important documents, adviser contact information, records of lifetime gifts and an “After I’m Gone” document.
Depending on how the policy is arranged, life insurance proceeds may be paid directly to beneficiaries, into a trust or to the estate. Policies written in trust can often be paid more quickly and may offer inheritance tax advantages.
A surviving spouse or civil partner may benefit from Additional Permitted Subscription (APS) rules, allowing them to retain certain tax advantages. Other beneficiaries inherit the assets but not the ISA’s tax-efficient status.
Inheritance tax rules can change over time, and proposed changes affecting pensions from April 2027 may impact many families. Regular reviews with a financial adviser can help ensure your estate planning remains effective.
A financial adviser can guide beneficiaries through pensions, investments, insurance policies, inheritance tax considerations and estate administration, helping them make informed decisions during a difficult time.
If you’re looking for a financial adviser, you’re probably facing an important financial decision.
You may be approaching retirement, deciding what to do with old pensions, investing an inheritance, planning for later life, buying a property, or simply trying to get your finances organised.
The challenge is that financial advice isn’t something you can compare on price alone. You’re choosing a person, and often a firm, that could help shape some of the biggest financial decisions you’ll ever make.
A good adviser should help you understand your options, avoid costly mistakes and build a plan around your goals. The right relationship can last for many years and evolve as your circumstances change.
Yet many people aren’t sure where to begin.
How do you know whether an adviser is properly regulated?
What’s the difference between independent and restricted advice?
Should Chartered status matter?
How do fees work?
And how can you tell whether you’re receiving genuine financial planning rather than simply being sold a product?
Working alongside financial planners, mortgage advisers and protection specialists has given me a front-row seat to the questions consumers ask most often and the factors that tend to matter when choosing an adviser.
This guide brings together the practical checks, questions and warning signs worth considering before making a decision.
| What to compare | Why it matters |
|---|---|
| FCA authorisation | Confirms the adviser or firm is authorised and regulated to provide the advice you need |
| Independent or restricted | Determines how broadly they can search the market |
| Qualifications and Chartered status | Indicates professional standards and ongoing development |
| Breadth of expertise | Your needs may span investments, pensions, mortgages and protection |
| Fees | You should understand both initial and ongoing costs |
| Minimum investment requirements | Some firms have minimum wealth thresholds |
| Ongoing service | Understand what you’ll actually receive for ongoing fees |
| Reputation | Reviews and recommendations can provide useful context |
| Personal fit | Advice is often a long-term relationship |
A financial adviser helps individuals and families make informed decisions about their finances.
| Area | What an adviser may help with |
|---|---|
| Retirement planning | Working out when and how you can afford to retire |
| Pensions | Reviewing and potentially consolidating pensions where appropriate |
| Investments | Building and managing a portfolio aligned to your goals, attitude to risk and capacity for loss |
| Tax-efficient planning | Making use of available allowances and wrappers |
| Estate planning | Considering how wealth may be passed to future generations |
| Protection | Reviewing life cover, income protection and other safeguards |
| Major life events | Planning around inheritance, retirement, divorce or business sale |
Many people assume financial advice is only about investments. In reality, the most valuable advice often takes a broader view, bringing together all aspects of your financial life into a coordinated plan.
Before choosing an adviser, think about what you’re trying to achieve.
| Your goal | Type of advice that may help |
|---|---|
| Planning for retirement | Pension and retirement planning |
| Building long-term wealth | Investment and financial planning |
| Buying your first home | Mortgage advice |
| Moving home | Mortgage and protection advice |
| Managing an inheritance | Financial planning and tax considerations |
| Protecting your family | Protection planning |
| Planning for later life | Retirement, estate and inheritance planning |
The best advisers spend time understanding what you’re trying to achieve before discussing products or recommending solutions.
Any firm or individual providing regulated financial advice in the UK should be authorised by the Financial Conduct Authority (FCA) or act as a representative of an authorised firm.
Before engaging an adviser, check the FCA Financial Services Register and confirm:
If you can’t verify an adviser or firm on the Register, don’t proceed until you’ve established their regulatory status.
Useful resource: FCA Financial Services Register
One of the most important questions consumers can ask is whether an adviser is independent or restricted.
| Independent advice | Restricted advice | |
|---|---|---|
| Advice basis | Can consider products and providers across the relevant market | May be limited by providers, products or scope |
| FCA regulated | Yes | Yes |
| Automatically better? | No | No |
| Key consideration | Breadth of market access | Understanding any restrictions |
Neither label tells you whether an adviser is right for you.
What matters is understanding how advice is provided, what options can be considered, and whether that approach suits your circumstances.
For more detail on the FCA’s rules:
Fairstone advisers provide independent financial advice and are not tied to specific product providers.
When comparing firms, it’s worth understanding whether access to the wider market is important to you and how each adviser or firm approaches its recommendations.
All practising financial advisers must meet minimum qualification standards.
Some advisers and firms go beyond those minimum standards and achieve Chartered status.
| Question | Why it matters |
|---|---|
| Are you a Chartered Financial Planner or Chartered Firm? | Indicates a commitment to professional standards, ethical conduct and ongoing professional development |
| What qualifications do you hold? | Helps demonstrate expertise and specialism |
| Do you regularly advise people in similar circumstances to me? | Relevant experience often matters as much as qualifications |
Financial decisions rarely exist in isolation.
| Your need | Areas of expertise worth considering |
|---|---|
| Retirement planning | Pension and retirement specialists |
| Investments | Investment advice and portfolio management |
| Family protection | Protection specialists |
| Passing on wealth | Estate and inheritance planning |
| Property decisions | Mortgage advice |
| Multiple priorities | Wider financial planning across specialisms |
A useful question to ask is: If my circumstances change, what other areas of advice can you help me with?
For most people, a mortgage will be one of the largest financial commitments they ever make.
Mortgage decisions can affect retirement plans, cash flow, savings capacity, protection arrangements and long-term financial goals, so they shouldn’t always be considered in isolation.
Many people spend years building wealth but devote less attention to protecting it.
Protection planning may include life insurance, critical illness cover and income protection.
A good adviser should be able to explain how protection fits into your wider financial plan rather than simply recommending products.
Investments matter, but they’re only one part of financial planning.
When speaking to an adviser, ask:
Some firms have minimum requirements relating to pensions, investments or overall wealth. Others don’t.
There is no standard industry minimum, so it’s worth asking this question early.
Transparency around fees is essential.
Advisers may charge fixed fees, hourly fees, percentage-based fees, initial advice fees, ongoing advice fees, or a combination of these.
Ask:
The FCA requires communications to be fair, clear and not misleading:
The lowest fee is not automatically the best value.
Understand:
The aim is to compare overall value, not simply cost.
Trust is difficult to measure, but most people know when it isn’t there.
A good adviser should listen carefully, explain complex issues in plain English and answer questions without pressure or jargon.
Alongside checking FCA authorisation and qualifications, it can be useful to review:
The FCA also publishes guidance on how regulated firms should communicate with consumers:
There is no fixed rule, but speaking to more than one adviser is often worthwhile.
It allows you to compare approach, expertise, fees and personal fit.
| Red flag | Why it matters |
|---|---|
| Can’t be found on the FCA Register | You may not be dealing with a regulated adviser |
| Pressures you to act quickly | Good advice should stand up to scrutiny |
| Makes promises about returns | Investment returns cannot be guaranteed |
| Is unclear about fees | Costs should be transparent |
| Recommends products before understanding you | Advice should start with your objectives |
| Cannot explain recommendations clearly | You should understand what you’re being advised to do |
Your first meeting should help both you and the adviser decide whether working together is the right fit.
You will typically discuss income, expenditure, pensions, investments, family circumstances, goals and attitude to risk.
The adviser should explain:
That depends on your circumstances.
Advice is often most valuable when you’re making significant decisions involving pensions, retirement, investments, inheritance planning or multiple financial goals at once.
The question isn’t simply ‘how much does advice cost?’ but ‘what am I receiving and is it appropriate for my circumstances?’
| Question | Why ask it |
|---|---|
| Are you independent or restricted? | Helps you understand the scope of advice and providers available |
| Are you authorised by the FCA and do you have the permissions required for the advice I need? | Confirms you’re dealing with a regulated adviser |
| What qualifications do you hold? | Provides context on expertise and experience |
| Do you regularly work with people like me? | Relevant experience matters |
| How are you paid? | Helps avoid surprises |
| What does any ongoing fee include? | Ongoing services vary significantly |
| Do you provide mortgage advice? | Property often plays a major role in financial planning |
| How do you assess protection needs? | Protection should be considered alongside other priorities |
| Do you have minimum investment requirements? | Not every service fits every client |
| How often will my plan be reviewed? | Helps set expectations |
| Sign | Why it’s important |
|---|---|
| You feel comfortable asking questions | Financial planning should be collaborative |
| Explanations are clear and straightforward | You should understand recommendations |
| Advice relates to your goals | Recommendations should reflect your circumstances |
| Fees are transparent | There should be no surprises |
| Risks are explained as clearly as benefits | Good decisions require balance |
| You feel listened to rather than sold to | Advice should start with understanding you |
Choosing a financial adviser isn’t about finding the cheapest fee or the most impressive brochure.
It’s about finding someone you trust to help you make good financial decisions over time.
Before making a decision, check the adviser is regulated, understand how they’re paid, ask about the scope of their advice and take time to compare your options.
The best advice relationships are rarely built around products. They’re built around trust, communication and a clear understanding of what matters most to the client.
| Resource | Link |
|---|---|
| FCA Financial Services Register | https://register.fca.org.uk/s/ |
| FCA Handbook COBS 4.2 | https://www.handbook.fca.org.uk/handbook/COBS/4/2.html |
| FCA Handbook COBS 6.2A | https://www.handbook.fca.org.uk/handbook/COBS/6/2A.html |
| FCA Handbook COBS 6.2B | https://www.handbook.fca.org.uk/handbook/COBS/6/2B.html |
| FCA Financial Promotions Guidance | https://www.fca.org.uk/firms/financial\-promotions\-adverts |
Chris Coulson is Marketing Director at Fairstone. Chris works closely with financial planners, mortgage advisers and protection specialists across the UK and regularly produces consumer education content on financial planning, retirement, wealth management and personal finance.
This article is for informational purposes only and does not constitute financial, tax, or legal advice. Tax treatment depends on individual circumstances and may change.
The value of investments can go down as well as up and you may not get back the full amount you invested.
Past performance is also not a reliable indicator of future performance. Always seek professional advice before making financial decisions.
No-one likes to think about the worst happening.
But preparing just in case it does can be life-changing.
For example, how can you keep up repayments on a mortgage if you become ill, are unable to work or if your partner dies?
I was reminded of this at a recent mortgage industry event where we heard some frightening statistics about how underserved we are as a nation when it comes to financial protection.
Financial protection comes in many forms, but the most common ones are:
This is where money – usually a lump sum – is paid after the death of the person insured.
This is where money – usually a lump sum – is paid out in the event of the diagnosis of a pre-defined illness, typically more common conditions such as cancer, a stroke or a heart attack.
This is where money is paid out, usually monthly, to cover some of the salary lost due to someone being unable to work for a prolonged period of time.
People taking on a long-term debt such as a mortgage would be well placed to consider financial protection.
Talking to a financial adviser can help you decide which form of financial protection is best suited to your situation and financial goals
One aspect of financial protection which is often overlooked is how it can help when other members of your family suffer a misfortune.
For example, if you child is seriously ill, you may need time off work to support them through their treatment.
Does your contract that you have at work cover you for when you’re ill, and if one of your children is ill?
This kind of situation is not hypothetical – at the mortgage event, one member of the audience told how her niece became seriously ill and the family were worried how they would cope.
After checking the protection policy, they found there was enough cover for her brother-in-law to take time off to be in hospital with their daughter as she recovered.
The couple were thankful that they had been advised on the policy and couldn’t have been more grateful that it allowed finances and fear of losing their home to be something they didn’t have to worry about at all.
I’ve heard from other advisers about how they have helped clients during reviews to claim on their policies following serious illness suffered by their children.
In all these cases, the policies allowed financial burdens to be lifted and the real threat of not being able to pay the mortgage to be removed.
Putting this cover in place allowed people to keep their jobs with sabbaticals and ultimately be there for their kids during unthinkable times.
Think about your situation: are you protected financially?
Do you have a family that could benefit from a conversation with a professional of how to protect what matters most to you?
Do you have a policy that needs reviewed, perhaps since you have had children?
These topics are not always easy to talk about – no-one likes to consider worst case scenarios.
But being brave enough to have the chat could be one of the best decisions you ever make.
Talking to an adviser can help you look carefully at your situation, decide what needs to be done and how best to approach things.
It could be one of the most important conversations you ever have.
YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE OR OTHER LOAN SECURED AGAINST IT.
Disclaimer: This article is for informational purposes only and does not constitute financial, tax, or legal advice. Tax treatment depends on individual circumstances and may change. A recommendation will be made only following a full assessment of your personal circumstances. Protection insurance is designed to provide financial support on death, illness or inability to work. It has no cash-in value and is not a savings or investment product. All policies are subject to terms, conditions, exclusions and limitations. Full details will be explained before any policy is taken out. For income protection and critical illness cover, payment of benefits is subject to meeting the policy conditions and insurer underwriting and claims criteria. Always seek professional advice before making financial decisions.
For many people over 55 who own their own home, equity release is still spoken about as “something you should never do”.
It is often misunderstood, occasionally feared, and sometimes dismissed outright based on decades-old information.
However, in the world of rising living costs, longer retirements, and wealth locked in homes, equity release has evolved into a flexible, well-regulated financial option that deserves its place.
It is no longer a niche product for people “with no other choices”. For many, it is a strategic decision that enables later life to be enjoyed, not endured.
Equity release is a way for older homeowners to access some of the money tied up in their home without having to sell it or move out.
In simple terms: if you own your home and it has gone up in value over the years, equity release lets you “unlock” some of that value as cash.
You can take the money as a lump sum, smaller withdrawals over time, or a mix of both.
There are two main types of equity release: a lifetime mortgage and a Home Reversion Plan.
The lifetime mortgage is the most common form of equity release.
Lifetime mortgages usually have a fixed rate of interest applied for the life of the loan. The interest rolls up over the term of the mortgage and no monthly payments are made.
The loan is usually repaid when you no longer live in your home.
For most equity release plans (especially lifetime mortgages), that means the money is paid back when:
At that point, the property is typically sold, and the proceeds are used to repay the loan plus any interest that has built up over time. Anything left over goes to your estate or family.
There is a further equity release option available (but not as widely used) which is know as a Home Reversion Plan. This is where you sell a percentage of your home and in return you receive a lump sum.
You still get to stay in your property for the rest of your life or if you have to move into long-term care.
When the property is sold, the company receives their percentage and the balance is paid to the estate.
One of the strongest advantages of equity release is the ability to unlock tax-free cash without having to sell or downsize. Your home remains yours, and you retain the right to live in it for life, or until you move into long term care.
This stability can be priceless for people who have lived in their homes for most of their lives and class it as part of them and something they do not wish to give up.
Whether it’s supplementing pension income, clearing interest-only mortgages, helping children on to the property ladder, funding home improvements, or simply enjoying retirement with greater peace of mind, equity release can provide access to capital that would otherwise remain inaccessible.
Some Equity Release plans also offer flexible drawdown options, allowing homeowners to release funds only when needed—helping to control interest costs over time.
Unlike traditional borrowing, most lifetime mortgages do not require monthly repayments. Interest rolls up over time and is repaid when the property is sold, providing reassurance for those on fixed or limited incomes.
Importantly, many plans now allow voluntary ad hoc repayments, giving borrowers control if their circumstances change.
Equity release today is a far cry from the products of the 1980s and 1990s. Plans regulated by the Financial Conduct Authority and approved by the Equity Release Council come with strict safeguards, including:
These protections mean neither you nor your estate can ever owe more than the value of your home.
Equity release can be expensive over time and the longer you live, the more money you – or rather your family – will owe.
Equity release also reduces the money that you leave behind, meaning your family will inherit less money after you’re gone.
Also, if you are in receipt of state benefits, you lose may lose them if they are means-tested.
With most equity release plans (like a lifetime mortgage), you’re not making monthly payments. Instead, the interest gets added onto the loan, and then future interest is charged on that bigger amount.
Therefore in plain terms, you’re paying “interest on interest,” so the debt grows faster over time.
One of the lesser known—but increasingly relevant—uses of equity release is its role in inheritance tax planning.
Property wealth frequently pushes estates above the nil rate band thresholds, creating potential IHT liabilities for beneficiaries. By releasing equity during lifetime, homeowners may be able to:
When gifts are made and the individual survives seven years, they may fall outside the estate for IHT purposes, depending on circumstances.
Additionally, some people choose to use equity release to fund regular gifts from surplus income or to settle existing debts, which can further simplify estate planning.
While equity release is not a ‘one size fits all’ solution for inheritance tax, it can form part of a broader, well advised strategy that balances personal enjoyment with family legacy.
False! With a lifetime mortgage—the most common form of equity release—you retain ownership of your property. The lender places a charge on the home, similar to a standard mortgage.
While equity release can reduce the value of an estate, it does not automatically eliminate inheritance. Many homeowners choose to guarantee an amount of their property value, and some plans allow repayment over time to preserve equity.
Beyond finances, many families would rather see loved ones enjoying life now than inheriting wealth later.
Interest does roll up, but rates are fixed or capped for life, and modern products include drawdown, voluntary repayments, and reserve facilities that help manage long-term costs more effectively than ever before.
In reality, many equity release clients are financially comfortable homeowners who want to use their assets more efficiently. It is increasingly used as part of holistic retirement planning rather than a last resort.
Equity release is not right for everyone, and it should never be entered into lightly.
It requires expert advice, family discussions, and a clear understanding of long-term implications.
However, dismissing it based on outdated myths does a disservice to homeowners who could genuinely benefit.
As property wealth continues to outpace pension savings for many, equity release has become a legitimate and responsible financial planning tool—one that prioritises choice, dignity, and quality of life in later years.
In an era where living longer also means funding longer retirements, perhaps the real question is not “Why would anyone use equity release?” but “Why should homeowners be criticised for choosing to enjoy the wealth they have worked a lifetime to build?”
There are other ways to free up capital tied up in your home.
Moving from a larger house to a smaller, cheaper property will help to generate money and, depending on the home, could also result in lower energy bills.
However, you will need to take into consideration the costs associated with buying and selling a home as well as moving costs, etc.
You may also prefer to stay in the home which you have made your own.
Another potential option is a retirement interest-only mortgage.
This is a mortgage that is based on pension income. You do not repay capital on a monthly basis, only the interest element.
However, this is generally not used since most people do not want to have an extra monthly expense.
A professional financial adviser can help you assess whether Equity Release is right for your circumstances and your financial goals.
If you decide to go ahead with Equity Release, a financial adviser can help you to choose the product which best suits your situation.
They can also help you with other implications of taking out an Equity Release plan, including estate planning and potential Inheritance Tax liabilities.
Get in touch with one of our advisers today to find out more.
YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE OR OTHER LOAN SECURED AGAINST IT.
Disclaimer: This article is for informational purposes only and does not constitute financial, tax, or legal advice. Tax treatment depends on individual circumstances and may change. The value of investments can go down as well as up and you may not get back the full amount you invested. Past performance is also not a reliable indicator of future performance. Always seek professional advice before making financial decisions.
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Equity release can be a good idea for homeowners over 55 who want to access tax-free cash tied up in their property without having to move.
It can provide financial flexibility in retirement, but it’s important to consider the long-term impact on your estate, inheritance, and overall financial plan before proceeding.
Yes, equity release is considered safe when taken through a plan regulated by the Financial Conduct Authority and approved by the Equity Release Council.
These plans include safeguards such as the No Negative Equity Guarantee and the right to remain in your home for life.
Yes. With a lifetime mortgage—the most common form of equity release—you remain the legal owner of your home.
The lender places a charge on the property, similar to a traditional mortgage, but ownership stays with you.
The amount you can release depends on factors such as your age, property value, and health.
Typically, the older you are, the more you can borrow. Most providers offer between 20% and 60% of your property’s value.
Yes, equity release can reduce the value of your estate, which may impact how much you leave to your beneficiaries.
However, some plans allow you to ring-fence a portion of your property’s value for inheritance or make voluntary repayments to preserve equity.
In some cases, yes. By releasing equity and gifting money during your lifetime, you may reduce the overall value of your estate.
If you live for seven years after making a gift, it may fall outside your estate for inheritance tax purposes, depending on your circumstances.
The main risks include:
This is why professional financial advice is essential before proceeding.
Most lifetime mortgages do not require mandatory monthly repayments. Instead, interest is added to the loan and repaid when the property is sold.
However, many modern plans allow optional repayments to help manage the balance.
When the last homeowner passes away or moves into long-term care, the property is usually sold and the loan—plus any accrued interest—is repaid. Any remaining value is passed on to your beneficiaries.
Yes, alternatives include downsizing, using savings or investments, or considering a retirement interest-only mortgage.
The best option depends on your personal circumstances and financial goals.
Yes. Equity release is a significant financial decision, and speaking to a qualified adviser ensures you understand the benefits, risks, and alternatives.
A professional can help tailor a solution that aligns with your long-term plans.
How long do you think you’ll live for?
Without being too morbid about it, this is an important question for all of us.
It’s also a factor in financial calculations such as annuities.
Yet there is another aspect to life expectancy which people often miss: how many years of healthy life do you think you’ll have?
This is arguably just as important as overall life expectancy – and should have an equal influence on how you plan for your later years.
The Office for National Statistics classifies Healthy Life Expectancy (HLE) as the number of years people are expected to spend in “good” general health.
This figure may well make you see life rather differently.
In the UK, men can expect to spend an average of 60.7 years in “good” health with women faring slightly better at 60.9 years.
In some cases, the prospects are worse.
For example, while in some areas of London and the South East people have a healthy life expectancy of almost 70, in Blackpool, men have an average HLE of just under 51.
This means that well before the State pension age, you could be living a life which is limited by poor health.
So, apart from potentially depressing you, what is my point in sharing these statistics?
It all goes back to the basic principles of financial planning which underpin everything we do here at Fairstone.
We work with you to help your money grow so that you can achieve your financial goals, whether that is retiring early, travelling around the world, putting funds aside for your loved ones or something else.
Whatever it is you are building wealth for, it is important to always bear in mind that the process of wealth accumulation is a means to an end, not an end in itself.
Wealth is important for what you can use it to do, not for what it is – it’s a tool, not a trophy.
It can be challenging for many people to switch their mindset from being a saver to being a spender.
Shifting from accumulating wealth to using it can take some getting used to.
One of our advisers told me how a client at a recent meeting was anxious and worried, despite having assets well into seven figures.
Try how he might, he could not contemplate using some of the wealth he had accumulated over the decades, fearful he might not be left with enough.
This ‘fear of tomorrow’ is more common than you might think.
However, with changes to the inheritance tax regime coming in April next year, people who hold on to all their assets ‘just in case’ could end up giving 40% of them to the Government rather than their loved ones.
And returning to the theme which I started with, there is a danger that if you continually put off that dream holiday you’ve always promised yourself or that round-the-world adventure you’ve planned for decades with your other half, you may end up not being well enough to enjoy it.
Spending money on yourself and your family while you are healthy is one of the great joys of life so make sure you don’t miss out on it.
Don’t let doing something ‘one day’ not happen on any day.
None of us know what is round the corner.
However, working with a financial adviser can help you plan for a whole series of eventualities – good and bad.
Creating a robust financial plan that’s flexible enough to change with your circumstances can help you face the future with confidence, whatever that may bring.
They can help you balance your current needs with what you want to leave when you’re no longer around.
And if you need some ‘permission’ that spending some of what you have accumulated is the right thing to do, just ask your adviser.
They will be able to give you an honest and informed opinion on your personal financial situation – and how using some of what you have accumulated will affect it.
Fairstone has expert advisers who can help you at every important stage of life, from buying your first home to planning your estate.
Get in touch with a Fairstone adviser to find out more.
Disclaimer: This article is for informational purposes only and does not constitute financial, tax, or legal advice. Tax treatment depends on individual circumstances and may change. The value of investments can go down as well as up and you may not get back the full amount you invested. Past performance is also not a reliable indicator of future performance. Always seek professional advice before making financial decisions.
At times, it seemed like this winter was going to last forever, but Spring is here at last.
As well as warmer weather and lighter nights, this time of year often brings a desire to move house.
Spring is traditionally the season where the housing market ramps up and, notwithstanding the impact of recent geopolitical upheavals, this year looks set to be no exception.
For many of us, buying a home is the biggest financial commitment we will make in our lives.
It is a major life event, but too often the temptation is to treat a house purchase as a stand-alone occasion rather than part of an overall financial life plan.
The other danger which we face is that we get emotionally involved in the process.
We really, REALLY want that house.
It’s got everything we could want and we’re already picturing ourselves living there.
When you get wrapped up in a house buying journey, it’s all too easy to disregard everything else in the pursuit of your dream home.
This is where working with financial adviser is worth its weight in gold.
Your financial adviser will sit down with you and put together a comprehensive financial plan:
A properly thought through and well-executed plan will help you to address the three crucial aspects of house buying which most people forget:
You don’t want to pay so much for your house that you’re left with very little to live on in retirement.
In an age of 30-year and even 35-year mortgages when the average age of a first-time buyer in the UK is 34, you could well end up still paying for your home when you’re past State pension age.
Factoring this into your calculations when weighing up the purchase of a home is something which many people neglect to do.
Planning to repay your mortgage before retirement is important.
Financial advisers can help with this, by supporting your plan from day one and throughout the term of the mortgage, potentially saving £1,000s in interest and supporting plans for saving.
The purchase of a home is the biggest debt you are likely to take on in your life.
Advisers have a duty to ensure you can cope with that debt and that your family won’t have to face taking on that debt should the worst happen.
Part of your plan should be to protect your home and your family income.
If you get ill, sick pay is a lot less generous than most people think it is.
With the global economy far from predictable, unemployment is a fact of life these days.
How will you keep up your mortgage payments if you are made redundant?
Your financial adviser will help you to tackle all three of these issues – and plenty more besides.
For example, by working with fellow professionals such as mortgage advisers (which we also have at Fairstone), they can help you get the best deal on the loan for your property.
And a few years down the line, they can do the same again to ensure your remortgage keeps you on a sound financial footing.
They can also review your protection policies as life events such as the birth of a child happen, to make sure these products are always appropriate for you and your families’ needs.
Importantly, a financial adviser will keep the other parts of your plan on track, rather than just give you a good mortgage deal.
So they will help you with things like saving for your children or grandchildren, paying for school or university fees, investing for your retirement and planning your estate.
These financial events very often overlap with your home buying journey so someone who knows how it all fits together – and can show you how with the use of tools like cashflow modelling – could prove invaluable.
And they are always there as a voice of calm reassurance and wise counsel when you’re unsure if you’re doing the right thing with your finances.
To borrow the title of a well-known TV programme, most people think buying a home is all about location, location, location.
In reality, it’s all about plan, plan, plan.
Buying a house isn’t just a transaction, it’s a key part of your financial life.
Wouldn’t it be much more of a home, sweet home if you knew it was part of your comprehensive financial plan?
Fairstone is home to a wide range of financial advisers, mortgage advisers and financial planning experts, ready to help you out on everything from property purchases to planning your retirement.
Get in touch with a Fairstone adviser to find out more.
YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.
Disclaimer: This article is for informational purposes only and does not constitute financial, tax, or legal advice. Tax treatment depends on individual circumstances and may change. The value of investments can go down as well as up and you may not get back the full amount you invested. Past performance is also not a reliable indicator of future performance. Always seek professional advice before making financial decisions.
It’s that time of year when all our amazing superwomen get the spotlight: Mother’s Day.
We know that for a lot of mums, it’s a constant juggling act – trying to manage childcare, possibly pursuing a career, the day-to-day of managing a household, family logistics, trying to plan for the long-term, looking after their physical and mental wellbeing and the emotional labour of it all, all at once – and with a smile and probably a lack of sleep if the children are young.
There’s a huge invisible workload as well as the visible one and can take its toll.
Eeven superwomen need a financial plan.
Motherhood can change everything, including finances.
A child’s arrival often means a huge shift in priorities.
It might suddenly feel that that long-term planning is now more urgent, financial resilience is now essential and the question tends to shift from “will I be okay?” to “will they be okay?”.
Mother’s Day is the perfect time to reflect, not just on the emotional side of motherhood but the financial foundations supporting it.
There are a few areas we can look at to help bring clarity to family finances and future planning, which in turn can help reduce the toll that motherhood can sometimes take.
There are a couple of potential quick wins that could help when it comes to managing the increase in day-to-day expenditure that comes with having children.
You may be entitled to 30 hours of free childcare a week if you live in England and have a child between 9 months and 4 years old.
It’s important to note that certain factors (such as employment and earnings) play a part in eligibility, so this won’t be for everyone but it’s definitely worth checking if this is something you can claim for).
If you live in the UK and have a child under 16 (or under 20 in approved education/training), you may be able to claim a tax-free child benefit payment every 4 weeks.
You can find out more about what qualifies for approved education/training on the Gov.uk website.
A High Income Child Benefit Tax Charge may apply if you or your partner earn over £60,000 but this could still be worthwhile.
In addition to these benefits, there are also some helpful savings vehicles that you could consider for your children, as well as important considerations in terms of dealing with a financial emergency.
These can be used to save for children under the age of 18.
Limits are currently set at £9,000 per year for the 2025/26 tax year and any gains and income are tax-free.
These can be opened either as Cash ISAs, Stocks and Shares ISAs, or both.
You can find out more about Junior ISAs in our recent article.
One way to help achieve a level of financial resilience is to work towards ensuring an easily accessible savings pot.
This should have at least 3-6 months’ worth of essential expenditure, not earmarked for anything other than an emergency fund.
This pot helps provide a buffer to be able to cover anything that might crop up unexpectedly, such as redundancy or unexpected bills.
Motherhood is a beautiful thing and being able to take time out to care for children is incredibly special.
Sadly, for a lot of mothers, this can also mean extended periods of time where personal and employer contributions into pensions aren’t being made.
This can then have significant effects on retirement savings in the long-term.
In addition, 35 years of qualifying National Insurance contributions or credits are required in order to be entitled to receive the full State pension at State Pension Age.
These NI contributions can also be significantly affected during this time.
When children are young, retirement can feel like a distant concept. However, the earlier planning begins, the more flexibility it creates later.
An important point in terms of retirement is that, according to the Office of National Statistics, women statistically live longer than men in the UK.
Inevitably, this means that retirement funds may need to stretch further than anticipated – and also be more resilient.
Some of the key considerations when it comes to retirement for mothers include:
Seeking financial advice can be instrumental in planning for the future and helping ensure that your retirement looks the way you want it to.
The clarity and peace-of-mind that this can create can be unmatched.
For many families, one of the biggest financial risks to a household is loss of income due to illness or death.
Financial protection planning is quite often put onto the back burner as it’s seen as not being ‘today’s problem’, but if either of these eventualities ever occurs, protection planning can be the difference between being able to continue looking after your family as normal or struggling to make ends meet.
Another important point to note here is that even unpaid caregiving has financial value and so protecting this is crucial.
By this, I mean that if one parent spends more time looking after the children, either by not working, or working less hours, replacing this childcare if something happened could be incredibly costly.
This pays out an income if you are unable to work due to illness or injury.
This pays out a lump sum in the event of death.
Joint policies can also be taken out between spouses and can also be held in trust.
This means the beneficiary of the payment does not have to wait for lengthy probate, which can have financial and emotional consequences at an already difficult time.
Life insurance policies can be in the form of term assurance (term-specific and may be aligned to a liability such as a mortgage or other debt) or on a Whole of Life basis.
This is similar to life insurance but pays out an income rather than a lump sum on death.
It can be critical for ensuring children are able to be looked after if something happened to you or your partner.
This is a lump sum paid out in the event of serious illness.
The definitions of what is included vary between insurers and this is where a financial adviser can help.
Protection simply ensures that difficult circumstances do not become financial crises.
Estate planning is often postponed but is one of the most critical steps parents can take.
As simple as it sounds, getting a Will in place, or ensuring it is up-to-date helps to:
Reviewing beneficiary nominations on pensions and life policies are also important to review and update, as these typically sit outside of a will.
As mentioned, since women are statistically more likely to outlive male partners, reviewing ownership of assets, tax planning strategies and long-term care considerations can provide the assurance that your legacy is protected.
Financial planning for mothers is not just about spreadsheets and products, it’s about confidence.
Confidence that:
Motherhood often involves putting others first. A financial plan that is robust and unique to you can ensure that doing so does not come at the expense of your own long-term wellbeing.
As Mother’s Day approaches, it may be worth asking not just what you are doing for your family today, but how you are supporting the woman who is holding it all together.
An expert financial adviser can help you create a robust yet flexible financial plan to help guide you through motherhood and beyond.
Get in touch with one of our advisers today to find out more.
Disclaimer: This article is for informational purposes only and does not constitute financial, tax, or legal advice. Tax treatment depends on individual circumstances and may change. The value of investments can go down as well as up and you may not get back the full amount you invested. Past performance is also not a reliable indicator of future performance. Always seek professional advice before making financial decisions.
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Financial planning for mothers ensures family security, protects against income loss, supports retirement goals and helps create long-term financial resilience.
Taking career breaks or reducing hours can reduce pension contributions and National Insurance credits, potentially lowering retirement income.
Parents may be eligible for Child Benefit, childcare support and National Insurance credits. Eligibility can be checked via Gov.uk.
Families often consider income protection, life insurance, family income benefit and critical illness cover to protect against loss of income.
Ideally, families should aim for 3–6 months of essential expenses in an easily accessible emergency.
Yes. A Will ensures assets are distributed correctly and guardianship arrangements are in place for minor children.
When you’re planning your perfect retirement, not many people want to think about preparing for potential care home costs.
The same is true for people who are already retired. Some 93% of over-75s have made no specific provision to cover the cost of their care, according to one survey.
Many people put off considering care costs – for themselves, a family member or a friend – because they find it too daunting or worrying.
However, thinking about these things now could prove invaluable for the future.
Here we look at some of the most common topics associated with care costs – and how consulting a financial adviser can help with the process.
If you are seeking support for care home costs or other care costs, there is a two stage assessment process.
First a Health Assessment is carried out to identify your wellbeing needs. This is called an NHS Continuing Healthcare assessment.
The second stage is a financial assessment to gauge the level of assets available to you.
NHS Continuing Healthcare provides full funding but only applies in very limited circumstances and only when your assets are below £23,250.
In most cases, it is sensible to assume that you will not quality for full funding, but you should still go through the process as you may qualify for nursing funding from the NHS which can help towards care costs.
Assuming you do not qualify for NHS Continuing Healthcare, you will then need to self-fund the care costs, until your assets fall below £23,250.
Local Authority financial support can begin when your assets fall below £23,250.
Pensions are not included in the £23,250 asset level, as they are seen to produce an income instead.
Your house may also be excluded, should your spouse remain in the home, or if a relative over 60 lives in the property.
If you are paying for care (which can be the occasionally help around the home), you may qualify for Attendance Allowance.
This is available as a weekly benefit regardless of means. They may also help provide respite or occasional hours of care.
Yes, you may need to sell your home to fund care home costs.
As mentioned above, the value of your home is excluded should your spouse remain in the home, or a relative over 60 lives in the property. Otherwise, it may need to be sold.
In my experience, renting the property often doesn’t result in the income needed to cover care costs, so do bear this in mind when deciding how to fund your care.
There are generally two options to consider when using your assets to pay for care:
Previously, some insurers provided products for pre-funding care, but unfortunately these are no longer available.
Once your assets (excluding pensions) are below £23,250, the local authority can get involved.
It’s a bad idea to deliberately reduce your assets to qualify for local authority funding. Having money available provides choice.
Think about using cashflow planning to assess affordability and provide financial understanding and security.
When considering how much to withdraw from your pension – and when – make sure you stage those withdrawals at sustainable levels.
You should consider earmarking specific funds for care costs as part of your retirement planning while maintaining quality of life (and enjoyment) in the early years.
If it sounds too good to be true then it normally is – gifting property to children or into trust can leave you vulnerable and not achieve what you want it to in terms of your care planning.
Getting expert financial advice – particularly at an early stage – can provide valuable peace of mind for you and your family when it comes to care costs.
At Fairstone, we have a number of financial planners (including myself) who are accredited with the Society of Later Life Advisers (SOLLA), who specialise in this type of work and would be delighted to provide assistance.
All SOLLA accredited advisers must attain the Society’s Later Life Adviser Accreditation and adhere to a strict Code of Practice.
The SOLLA Later Life Adviser Accreditation is widely regarded as the gold standard in later life financial advice.
To discuss planning your potential future care needs, get in touch with an adviser today.
Disclaimer: This article is for informational purposes only and does not constitute financial, tax, or legal advice. Tax treatment depends on individual circumstances and may change. The value of investments can go down as well as up and you may not get back the full amount you invested. Past performance is also not a reliable indicator of future performance. Always seek professional advice before making financial decisions.
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In England, local authority funding typically begins when assets fall below £23,250 (excluding certain pensions and property exemptions).
Eligibility is limited and based on primary health needs.
Most people do not qualify, but it is still important to complete the assessment.
Not always. Your home may be excluded if a spouse or qualifying relative remains living there.
A care annuity (also called an immediate needs annuity) is a financial product that converts a lump sum into a guaranteed, tax-free income paid directly to a care provider.
Deliberately reducing assets to qualify for funding may be treated as deprivation of assets and can be challenged by the local authority.
No. Attendance Allowance is not means-tested and may be available regardless of income or savings.
