One constant of the past 70 years or so has been improving living standards.
As they post-war Baby Boomer generation enter retirement over the next ten to twenty years, we expect to see an economic shift as vast sums of wealth are released or at least transferred.
Some estimates suggest the Baby Boomers, who represent around 20% of the UK population, control as much as 80% of its wealth.
Despite the challenges around longer life expectancy and the cost of long-term care, many Baby Boomers can expect a financially comfortable retirement funded by their property and non-property assets.
Things do not look so good for their children.
A new report from the Institute of Fiscal Studies (IFS) has found that those born in the 1960s and 1970s could become the first generation since the end of the Second World War who will be worse off financially than their parents.
The children of the Baby Boomers are less likely to be property owners, can expect a smaller State and private or occupational pension income, and will have no greater levels of savings or income than their parents.
This is despite those born in the 60s and 70s generally earning more during their working lives than their parents; they simply failed to accumulate savings and investment wealth, instead spending the money on maintaining their lifestyles.
A chance for financial redemption exists with hopes for an inheritance.
As we have explained before, these hopes may never come to fruition, with wealth in later life easily spent on expensive care fees and expected inheritances whittled away to nothing.
Those born after the Baby Boomers have also been hit hard by the closure of defined benefit (final salary) pension schemes, often replaced by less generous defined contribution schemes.
Delaying a step onto the property ladder has also had a big impact on comparative wealth, with Baby Boomer children less likely to be homeowners.
One way to ensure you are not poorer than your parents is to create a comprehensive Financial Plan.
Defining your personal financial goals, understanding the impact of different lifestyle choices and creating a robust plan to achieve what you want in life is the valuable result of Financial Planning.
Do speak to us about our LifeWealth Design service and how we can help you continue improving living standards.
