Relying on inheritance windfalls
If you are, you’re not alone.
New research suggests one in three working age people in Britain are banking on an inheritance to make everything alright in the future.
The bad news? They could be in for an unpleasant shock.
The research, carried out by retirement specialist LV=, found millions of Brits are banking on an inheritance to provide them with financial assistance, with this cash windfall often key to their retirement plans.
The most common plan for any inheritance is to pay off debts including the mortgage.
One in six people (16%) would use inherited funds to bolster their retirement savings.
Unfortunately, for those individuals that are hoping to be left an inheritance, the number of people leaving significant amounts to the younger generation is falling, with most people are leaving less or nothing at all.
The research found that a quarter of retirees (28%) don’t expect to leave much to their children.
A fifth (20%) say they intend to spend their money enjoying their retirement rather than leave it behind and 4% say they will follow Bill Gates and Warren Buffett’s lead and leave their cash to charity.
Where does this leave people who are expecting to receive an inheritance to pay off the mortgage and boost their retirement income?
One in five say they will struggle to retire comfortably without inheriting and a quarter will have to work longer than planned should they not receive such a windfall.
Where does receiving an inheritance factor into your own Financial Plan?
Have you had a discussion with your parents so expectations are better managed?
Receiving an inheritance can play a useful role in Financial Planning, but it should be based on clear plans rather than vague expectations.
Do speak to us if you have any questions.