Millennials are sleepwalking into a financial nightmare as one-in-four say they rely on inheritance to retire without realising their parents would rather “spend than pass it on”.
A study commissioned by the national law firm Stephensons reveals that 18-34 year olds are more dependent on inheritance than any other age group as confidence in private and state pensions plummets. Millennials rank pension contributions even below savings when it comes to retiring, a stark contrast to the over 55s, where 80 per cent listing pensions as their primary source of income during retirement.
The results of the study are especially concerning as two out of three ‘baby boomers’ say that they would rather spend their inheritance than pass it on and will not bankroll the future security of their children.
Regardless of the high dependency on inheritance across the country one-in-two UK adults (48%) admit that they have not discussed the contents of any will with the people they expect to inherit from. This rises to a shocking 79 per cent among 18-24 year olds with only one-in-five having such conversations.
The study also revealed a worrying regional divide as one-in-three London respondents said they would rely on inheritance to retire, the highest of any area in the UK. By comparison, in Newcastle and Manchester, only one-in-ten said their retirement relied upon inheritance, highlighting a significant disparity.
Andrew Leakey, Head of Dispute Resolution at Stephensons said: “The results of this study are representative of the cases we see on a daily basis. People often expect and rely upon a potential inheritance from parents or grandparents and in many cases are let down by the actual contents of the will.
“In most cases, any dispute within the family could have been prevented had there been an open and honest discussion about any estate being left behind to provide for children or grandchildren. Inheritance disputes can quickly deteriorate into lengthy court proceedings dividing families for many generations.
“For millennials, the implications of being ill-informed can have grievous consequences as all indications suggest they will need to fund their retirement privately with little or no state support.
“Discussions about inheritance should never be avoided as the financial security of many can depend on the contents of a single will.”
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