According to the NHS, nearly 1 million people in the UK live with dementia, equalling 1 in 11 people over 65.
As advisers, we might go on assuming that dementia, or similar cognitive illnesses, are relatively rare. But with the above statistic in mind, it’s highly likely that you will encounter a client who is:
- Living with dementia
- Caring for someone else who has it
- Acting as an attorney on a loved one’s property and financial affairs Lasting Power of Attorney (LPA).
So, it is essential that we proactively engage with the subject of cognitive decline and educate ourselves on the financial and practical issues that these clients could face. And what better time to delve into the topic than Dementia Action Week 2025, which ran from 19 to 25 May?
Keep reading to learn how dementia can affect a person’s financial circumstances and ways you can show support to families as an IFA.
2 key financial issues those living with dementia, and their families, can face
As you may have experienced in your practice, financial hardship is one of many key issues faced by those living with dementia and their families.
These challenges generally present themselves in two distinct ways:
- The loss of mental capacity that dementia patients experience can lead to an inability to make informed decisions, and in turn, makes it near impossible for someone living with dementia to manage their own finances fully.
- The cost of dementia care can be extremely draining on a person’s financial resources – co.uk says that in 2025, average fees are £1,554 a week, equalling £80,808 for year-round care.
Let’s take a look at each of these factors in more detail.
Losing mental capacity
As you will likely already know, when a person without a property and financial affairs LPA loses mental capacity, it can be extremely difficult for their loved ones to access the funds they need to offer support.
Let’s imagine John is diagnosed with dementia and doesn’t have an LPA. His wife, Sarah, who has full mental capacity, would need to go through the Court of Protection to become a deputy, with similar powers to an attorney. This can take months, and without these powers, Sarah may not be able to sell assets in John’s name – such as additional properties – to fund top-of-the-line care.
The cost of dementia care
As your clients age, the likelihood of them needing care will naturally increase. You may already have several clients who have had to adjust their financial arrangements in order to support a loved one in care, or pay for their own.
Dementia care is one of the most expensive forms of care, due to the additional security measures needed to keep patients safe, as well as the employment of specially trained nursing staff.
Coming back to the example of John and Sarah, imagine that John is 70 when he is diagnosed. According to Alzheimer’s Society, depending on the type of dementia John is diagnosed with, he could live for up to 10 more years or more, and may need care for a large portion of that time. In short, John’s care could cost the family hundreds of thousands of pounds.
3 important ways that IFAs can support clients with dementia
1. Support families with Lasting Power of Attorney and Court of Protection issues
As an IFA, it’s crucial to stress the importance of LPAs to any client who will listen. These simple documents can be life-changing, but the latest available data, produced by Canada Life, suggests that 77% of over-55s don’t have one.
If it’s too late and a client or their family member has lost capacity due to dementia, you may also wish to support them while they’re dealing with the Court of Protection.
Of course, a person gaining deputyship or becoming an attorney is not the end of the road, but rather where it starts. If a client is suddenly made responsible for a loved one’s financial affairs, they are likely to feel overwhelmed at times, and this can go on for years. It could even be detrimental to their own financial plan, seeing as their efforts may be understandably focused elsewhere.
So, to support them, make sure to:
- Keep in contact outside of their annual review
- Be a confidant when they feel like it’s all too much
- Take a weight off their shoulders by providing simple, reliable solutions where possible.
Read more: Financial wellbeing – a wishy-washy platitude or a sea change for financial planning?
2. Take a bespoke approach to care planning
Finding ways to fund a loved one’s (or their own) dementia care may be the top priority for your clients. Even those with substantial wealth could have their financial stability threatened by the ever-increasing cost of care, which could also affect how much they can afford to pass down to the next generation.
If you are working with a family who is going through their options at present, it’s important to prioritise:
- The care options available in their area
- The individual and/or family’s long-term financial security.
For instance, many assume that in order to pay for care they will need to sell their home. This may be the case, but until you examine their situation as a whole, you won’t know what their options are. There could be a surprising number of opportunities to pay for care without giving up a much-loved property.
3. Keep up with your own CPD
As an adviser working with someone who has dementia, there will be aspects of handling their case that you may not have come across before.
From capacity assessments to the Court of Protection, you could find yourself in unfamiliar territory and feel unsure about how to advise someone in such a complex situation.
That’s why keeping up with your own CPD matters so much. With the UK’s population becoming older on average, it may be worth taking extra steps to ensure you’re equipped to advise those experiencing cognitive illnesses.
For instance, you might consider joining or getting in touch with the Society of Later Life Advisers (SOLLA), attending optional workshops and courses on vulnerability, and chatting to other advisers about the steps they’re taking too.
It’s not just dementia that may prove difficult to advise on; the FCA says that 49% of UK adults are financially vulnerable in some way. Becoming a “lifelong student” means always seeking to understand more, with the aim of supporting clients no matter what they’re going through.
Get in touch
As a growing network of likeminded IFAs, Corbel Partners could be the perfect home for your advice business, especially if you want to expand your practice and honour your commitment to excellence.
Our training courses, ongoing mentorship, and bespoke tech solution with vulnerability flagging software, all help our growing community of advisers to deliver bespoke outcomes that truly benefit clients.
Email hello@corbelpartners.co.uk or call 01925 637891 to find out more.
Please note
This article is for general information only and does not constitute advice. All information is correct at the time of writing and is subject to change in the future.
The Financial Conduct Authority does not regulate estate planning.