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As the debate over how Britain will fund an ageing population intensifies, many affluent households are worried about later-life care but failing to plan for it, according to Rathbones, one of the UK's leading wealth and asset management groups.
The findings are set out in Rathbones’ new report, The New Retirement Reality, launched today, and come as the government announces plans to overhaul the State Pension triple lock from 2030 to help fund a major expansion of social care provision.
Research among 2,036 UK adults with at least £250,000 in investable assets found that 40% rank the cost of care among their three biggest retirement concerns. Yet only 12% have made detailed plans to cover those costs, while 45% admit they have not meaningfully factored care into their retirement planning at all.
This lack of preparation is reflected in the inaugural Rathbones Retire Well Index*, a new behavioural benchmark that measures how actively affluent households are preparing for retirement and later life. Rather than tracking confidence or intentions, it measures real-world actions, from pension engagement and retirement planning to estate planning, care-cost preparation and responses to pension inheritance tax changes.
The Index is scored on a scale of 0 to 100, where 0 represents very low levels of planning and engagement and 100 represents the highest levels of reported preparedness.
Across the affluent households surveyed, the average score was just 44 out of 100, placing the typical respondent in the Index's moderate preparedness band. Even respondents who described themselves as "extremely prepared" scored only 50 out of 100 on average, highlighting a significant gap between confidence and action.
Stephen Field, Director of Advice, Supervision and Oversight at Rathbones, says: “Care costs are the elephant in the room of retirement planning. Many people tell us they worry about them, but far fewer are taking practical steps to prepare. That preparation gap is reflected in our Rathbones Retire Well Index - even among those who believe they are well prepared.
“With people living longer, but not necessarily healthier lives, more retirees are likely to face periods of ill health or care needs. Without a plan, money intended for travel, lifestyle goals and family could ultimately be used to fund care instead.”
Wealth doesn't eliminate retirement uncertainty
These findings form part of The New Retirement Reality, which explores whether affluent households are truly prepared for later life, examining everything from retirement income and longevity to inheritance planning and financial resilience.
At the heart of the report is what Rathbones calls The Great Decumulation Challenge: turning money saved over a working lifetime into enough to live on, taking into account longer lives, rising costs of care and unexpected life events.
Even among wealthier individuals, retirement anxiety remains widespread. While 78% say they have a clear retirement funding plan, 75% understand their pension entitlements and 74% believe they are on track for the retirement they want, almost half (45%) still worry they have not saved enough.
The findings suggest that wealth alone does not eliminate uncertainty. Instead, many households are grappling with questions around longevity, care costs, tax changes, income sustainability and how to balance enjoying their wealth with supporting future generations.
Stephen Field says: "For many clients we speak to, their questions are: How long will my money last? How should I draw income from different assets? What happens if I need care? How do I support loved ones without compromising my own financial security? Even if they have enough money to retire, many people aren’t sure how long it will last”
“Having wealth and having confidence are not necessarily the same thing."
Other findings from The New Retirement Reality include:
- Working in retirement: 42% of those yet to retire expect to phase gradually into retirement, while a further 16% expect to reduce their hours but continue some form of paid work.
- Pensions and inheritance tax: 24% are unaware of the planned pension inheritance tax changes due in April 2027**, while 35% of those aware have yet to take any action.
- Inflation remains the biggest retirement concern, cited by 46% of affluent individuals, ahead of tax changes affecting retirement income (43%) and later-life care (40%).
- 57% prioritise using their wealth to fund retirement, compared with 18% who prioritise leaving an inheritance.
