Parents to snub children in inheritance
The research, which examined the financial health of 1,000 under 40s and 1,000 over 50s, showed that one in four over-50 year olds intend to pass over either a percentage or none either because they ‘want them to stand on their own two feet’ or they don’t believe it’s deserved.
More than one in five (23%) reason that their children have already had a share of their inheritance to help towards buying a house, paying off debts or getting through university.
This could come as a blow to many, as over half of under-40s are banking on receiving a substantial inheritance, while one in five want to use it to get on the property ladder.
Indeed, 22% of those who aren’t planning to leave everything to their children admit their decision is likely to cause arguments within the family.
Andrew Barker, managing director of Skipton Financial Services, said: “Traditionally your entire financial wealth and any assets would all be inherited by your children after your death.
“But it seems this is becoming a thing of the past as people want to use the ‘would-be’ inheritance fund to enjoy their own well-earned retirement or even because they feel their children have already had their fair share.
“While Bill Gates’ children are still in line to receive a tidy sum if they get even 1% of his estate, more than most Brits could ever dream of, the sentiment behind the decision is the same – wanting their children to ‘stand on their own two feet’ and not rely on a windfall to come their way one day to save the day to pay for their financial future.”
Three quarters of parents intend to leave everything they own to their children, yet 14% are planning to leave some of it while one in 10 have plan to not leave anything.
Of those who aren’t going to transfer everything, around a quarter (24%) want to enjoy the money themselves by going on holidays, buying new cars or living life to the full.
More than one in 10 (12%) think their children don’t need the money and plan to pass it on to their grandchildren instead, while 15% think their children don’t deserve an inheritance because they are poor at managing money, will squander it or have had enough help already.
Of those who have already handed money over, a third (33%) said they realised that their children are financially restrained.
If parents decided to leave them little or no inheritance, 15% of children would be upset, while more than one in 20 even admitted they would be ‘gutted’.
Barker added: “We are living longer than ever before, so it’s not realistic for young people to rely on their inheritance to fund their retirement.
“Whilst 86% think their children deserve an inheritance, it’s entirely possible your parents could still be with you way after you start collecting your pension so they will need their hard-earned money to fund their own life in retirement, something over four in 10 said.
“But with so many assuming their parents will leave everything to them, there could be a large number of disappointed and financially troubled Brits in years to come.”