Article last updated 5 September 2026.
The trade-off between care and legacy
Clients often face a tension between preserving wealth for future generations and ensuring they can access the care they need.
While many remain focused on passing on assets, priorities can shift when care needs arise. Advisers play a key role in helping clients strike the right balance, ensuring care provision is adequately funded while maintaining alignment with long-term legacy objectives.
Inheritance tax considerations
Based on current HMRC rules, the inheritance tax nil-rate band is £325,000 and the residence nil-rate band may provide an additional allowance of up to £175,000 in certain circumstances. Tax treatment depends on individual circumstances and may be subject to change.
With thresholds frozen, some clients may find that estate values move closer to, or above, the inheritance tax threshold over time. This reinforces the need for proactive planning, particularly where care costs may reduce the value of the estate.
Planning strategies
A range of strategies may support both care funding and legacy objectives, depending on individual circumstances. These may include:
- Phasing or structuring gifts
- The use of trusts
- Investment solutions designed to align with long-term planning goals
A coordinated approach ensures that access to capital is maintained where needed, while also supporting wealth transfer over time. These approaches will not be suitable for every client and may have tax, legal and access-to-capital implications. Advisers should consider whether specialist tax or legal advice is required.
The importance of governance
Clear governance is a core part of later life planning. Wills and lasting powers of attorney help ensure that:
- Decisions can be made if capacity is lost
- Assets are distributed in line with client wishes
These arrangements provide clarity for families and support smoother decision-making at what can be a challenging time. Working alongside legal professionals can help ensure wills and powers of attorney reflect clients' wishes and are put in place correctly.
