What shifting demographics mean for financial wellbeing strategies

The ageing workforce is having a profound effect on how we do business not least by creating a huge financial burden on individuals and businesses.

The UK workforce is ageing at pace.

According to figures from the Centre for Ageing Better, one in three workers in the UK is aged 50 or over and there are 4.2 million more of those older workers than there were at the turn of the century.

An ageing workforce requires different support.

Childcare demands are likely to be replaced by adult care responsibilities – whether that’s looking after a parent or a partner.

In fact, the UK workforce now looks after more adult dependants than child dependants.

The financial cost of navigating care is a burden so immense that it reshapes entire family budgets, forces tough financial decisions, and puts long-term financial security at risk.

So why isn’t everyone talking about it? And why don’t we have ‘care pots’ alongside ‘pension pots’?

Here are 5 reasons why supporting caregivers in the workplace should be a key component in your firm’s financial wellbeing strategy.:

1. £8.3 billion is spent on private adult care needs in the UK

The financial strain on caregivers is immense, with billions of pounds being privately funded by families every year.

The National Audit Office, citing industry experts Laing Buisson, estimates that approximately £8.3 billion is spent on privately purchased social care in England.

As healthcare costs rise, employees are forced to dip into their savings, retirement funds, or emergency reserves to cover care expenses.

This added financial burden directly impacts their ability to focus and perform at work, making financial wellbeing an urgent priority for HR leaders.

“There is a gap that people are having to fill with personal savings – and the consequences are huge,” says Stephanie Leung, founder and CEO of KareHero.

“One of the ways that employers can support their people facing this challenge is by helping them access untapped funding.

“Over £9 billion in care benefits goes unclaimed every year.”

2. By 2040, this figure will double, and the government will not be able to plug the gap

The cost of caregiving is not just a current issue but a growing crisis.

With an ageing population and increasing care needs, employees will face even greater financial pressures in the coming years – with an expected £8 billion gap.

“Relying on government aid will not be a viable solution, meaning more employees will turn to personal finances,” said Leung.

“Proactive HR policies that address financial wellness now will help mitigate future workforce disruptions.

“As much as anything, it’s about taking a proactive approach in raising awareness of the financial costs ahead.”

3. One in five employees is caring for a family member

A significant portion, one in five, of the workforce is balancing caregiving responsibilities with their jobs.

Without proper workplace support, many caregivers may have to reduce their working hours or leave their jobs entirely, leading to talent shortages and increased turnover costs for businesses – alongside the impacts of stress and burnout.

4. Almost half of the 400,000+ care home residents in the UK are self-funded

Financial security is one of the biggest casualties of caregiving.

The majority of caregivers drain their savings accounts, leaving them vulnerable to long-term financial instability.

It’s a difficult scenario to support, with costs in the thousands.

Education and support to access the funding that is available is just one way employers can support the hundreds of thousands of people who will have to self-fund their care.

5. More than 28,000 people aged 65+ died in 2022/23 before receiving the social care they were waiting for

This equates to an average of 79 deaths a day, 550 a week, and 2,388 a month, according to Age UK.

The charity says that in many cases, had these older people got the help they needed their final days would have been more comfortable, and their families would have felt less alone and better supported.

HR leaders must recognise this severe impact and consider offering financial planning resources, caregiver benefits, and flexible work arrangements to help employees manage their caregiving responsibilities more effectively.

A call to action for HR leaders

The connection between financial wellbeing and caregiving is clear, and the burden is only increasing.

HR leaders must take proactive steps to support employees before financial stress leads to burnout, disengagement, or workforce exits.

By integrating financial wellness initiatives and caregiving support into your benefits and wellbeing strategy, you can foster a more resilient, engaged, and productive workforce.

Caregiving is no longer a private issue – it’s a workplace imperative.