Too many people are dying in hospitals and care homes, and not at home the way they want to, says a report from Demos.
Of the 500,000 people who die each year in the UK, the think tank found only 18% die at home, yet 60% of people surveyed would like to.
Investing in community-based end of life care would also save the NHS money in the long term, the report says.
The Department of Health is reviewing funding for England. Services in the rest of the UK are funded locally.
The report, entitled Dying for Change predicts that by 2030 more people will die in hospital (65%) and fewer people will die at home (just one in 10 people).
In 10 years, Demos predicts that 20% of people will die in care homes, a figure currently at 17%.
Yet a poll of 2,127 people carried out as part of the report shows that two in three people would prefer to die at home, surrounded by family and friends.
This equates to more than 190,000 people dying in hospital each year when they would rather be at home.
Not everyone who dies in hospital knows they are going to, but many do.
Two in five people who die in hospital do not have curable conditions and most people will be ill for six years before they die.
It is estimated that 20% of hospital beds are currently taken up with caring for people who are dying.
The report says that investing £500m more a year would allow more of these people to die at home or with support in the community.
Setting up new places for people to die close to home, training volunteers to support the terminally ill, a 24-hour nursing support service and an "end of life telephone help line" are all suggestions the report makes on how this money could be spent.
It also proposes setting up a national "hospice at home" service to help support people dying at home.
Demos claims that making this investment would result in fewer and shorter hospital admissions, helping the NHS save money in the long term.
At present, around £20bn of NHS services is spent on end-of-life care.
This is forecast to rise to £25bn in 2030.
Charles Leadbeater, co-author of the Dying for Change report said: "It's not just that we're living longer; part of this means that people are dying over a longer period, losing first their memory and then their physical capacities in stages.
"If we put in the right kind of supports for people to cope at home, many tens of thousands of people could have a chance of achieving what they want at the end of life; to be close to their family and friends, to find a sense of meaning in death."
Care services minister Paul Burstow said the government wanted to ensure that the care people receive at the end of life is "compassionate, appropriate and gives people choices in where they die and how they are cared for".
"Identifying people approaching the end of life and advance care planning is an essential part of this," he said.
"We are consulting on extending patient choice and want to move towards a national choice offer that supports those who wish to die at home."
David Prailll, chief executive of the charity Help the Hospices, said the report would help to stimulate public debate.
"It also makes some very interesting suggestions about specific practical steps that could be taken at a national level and these merit deeper investigation."
"Seventy per cent of hospice care takes place in people's homes and a growing number of hospices - already over two-thirds - provide support to care homes to make sure residents get the palliative care they need," he said.
BBC News website readers have been sending in their reaction. Here is a selection of comments:
My husband was terminally ill with Angio Sarcoma at Guy's Hospital in August 2004. The doctor came to tell him that the cancer has spread to his other lung too. My husband said he would like to go home and yet the doctor made me feel that it would be more suitable if he stayed in the hospital. I did not understand why it would be more suitable for him to stay there. He died four days later. He was so sedated that he died without us getting a chance to say goodbye to him. I still keep worrying that I let him down by not insisting on him coming home. I still have not got over the way he died. It was so impersonal. Ranjna, London
My father died at home several years ago, which was his wish. He had been in and out of hospital and spent time in a local hospice, but it was at home where he wanted to be, and where my mother could best care for him. The GP was superb, there was a district nurse visiting regularly to help us prepare for his death, and although desperately sad for the family, it was what he and my mother wanted, and they were at peace with that. Penny, Dorset
I lost my mum and although she was totally dependant on me in the last years of her life, when it came to the end she died in hospital. I suppose because I couldn't bear to be alone when she died, not knowing if I was doing everything to make her going as painless as possible. I know in my heart that she would have forgiven me taking her in hospital but it is so hard for the loved ones to make that decision. We all, in an ideal world, would like to just go to sleep in our own bed at the end but real life isn't like that. Daisy, Reading
My mother died today in a care home. In her last few weeks she has needed continuous care and kindness to keep her clean, as she was incontinent. A hoist was needed to raise her weak body and a special bed was used to prevent bed sores and aid her in being fed. It is a nice idea that we should all die where we want to but life is not like that. My mother would also not have wanted to die in a care home but as it happens she had dementia and didn't know where she was. She had the very best of care, the bedroom was equivalent to her bedroom at home, so what is wrong with that? People would not get 24 hour care if they stayed in their own homes and the expense would be enormous if they privately hired a 24 hour a day carer. Christine, Portsmouth
I work for the NHS and it is very frustrating that patients can't die at home because of the paperwork. Sometimes it is also very dependent on your postcode. If your GP is in one PCT and you live in the next borough, you are not entitled to services as they do not receive from that borough. I speak from experience as I have recently had battles with two PCT's in getting services so that my patient could die at home. One solution given to me was that the patient changes his GP, but this is not always suitable when you have been with a particular GP and have built a relationship. As a health care professional I try very hard to give my patients the choice of dying at home. Suki, Harrow
My mum passed away only a couple of months ago and it was her wish to die in hospital. She was terrified of dying at home for many reasons. I have to say that the hospital was superb and cared for her wonderfully and I can also say she died feeling safe. Whilst many people do wish to die at home, it should be realised that many people feel safer in a medical situation, where there are nurses and doctors around to make them comfortable. Rob, Lancashire
My mother was able to die at home but only because of my persistence. She had a major stroke on 18 June and was in hospital for four days. She had signed a "Living Will" five years before and we knew her wishes, so she was not being artificially fed but just kept comfortable. When she indicated her wish to go home, the hospital made it appear an impossibility. Luckily I have friends in the NHS and was able to take their advice and through the "Fast Track for the terminally ill" was able to get her home within 24 hours. She had 36 hours in her own bedroom before dying. Jinny, Wales