A recently released study has highlighted growing numbers of people are relying on the prospect of a large family inheritance funding through their retirement years, with one in five British adults now anticipating that they expect to benefit from a family member’s estate.
The study by pensions provider Hargreaves Lansdowne, also found that 17% of adults surveyed were anticipating getting a significant bequest, with two thirds of those being aged between 18-54 and hoping to use this to fund their retirement. All of this despite the fact it could potentially be less than hoped, take a lot longer to materialise, or may even not materialise at all.
For those that are inheriting, recent changes to inheritance tax rules mean that a larger sum can be made available in some circumstances. The joint inheritance tax threshold for a married couple / civil partnership was raised to £1m (based on certain criteria), meaning that the couple could leave assets between themselves before any inheritance tax would be payable.
This is of course good news for those who would stand to inherit a larger amount to be able to factor this into their retirement planning, but with many people living to a much later age – can it really be relied on? This may not take into account future care fees, retirement spending or for people changing their wishes about who they would like to leave their estate to – we’ve all seen the cases in the news about family members having to challenge wills due to the deceased cutting someone out of their will, or leaving everything to the local cat’s home. You could even be well past your intended retirement age yourself before any inheritance is realised.
I would always say in these situations that nothing is guaranteed and it’s important to take advice and plan where possible when it comes to your retirement and future plans.
Estate planning can be a complicated and time consuming process but our Private Client team can guide you through the best course of action for your specific situation. Get in touch today by calling 0845 287 0939 or send us a message.