In the UK, the average life expectancy of children born in 2013 is over 90 years old, and the number of people aged over 65 already outnumbers those under 16. In the next five years the number of consumers aged over 65 in the UK is expected to increase by 1.1 million and the proportion of people aged over 100 will rise by 40%, according to a 2015 Parliamentary review.
These changing demographics provide a growing customer base for the financial services sector and are driving a need for new and different financial products and services. “The fastest growing segment of society is people aged 85 plus,” said Jane Vass, head of policy at Age UK. And, in FCA's view, as people are living longer, financial services need to adapt.
The ageing population discussion paper features think pieces from interested individuals and organisations on what older people need from financial services providers. The FCA will then combine this with its own analysis of current regulatory priorities to focus the scope of the project on particular financial products or services, said the organisation.
The project will look at the way in which financial services meet the needs of older consumers in order to prioritise a programme of work that looks specifically at the ageing population, with a view to publishing a series of recommendations for future action in 2017. The research team is led by Linda Woodall, director of life insurance and financial advice at FCA.
The FCA will then develop a strategy on the ageing population based on the research, which will be launched in 2017. The strategy will make recommendations about how to improve outcomes for older people, including whether regulatory settings need further review.
More research will be conducted in the second part of 2016. Challenges that need to be dealt with include long-term care and handling cognitive decline. "Evidence also suggests that as we age we tend to rely less on reasoned, deliberative thinking and more on gut-feel and things learned through experience, said Woodall. "Older people also find it more difficult to navigate the proliferation of choice," she added.