-
Younger generations would prefer to receive money over things
-
Millennial savers most likely to use inheritance for house deposit
-
Almost 4 in 5 adults still not talking to their family about inheritance
Research conducted among 2052 UK adults found that three-quarters (75%) of adults in their twenties and thirties would prefer to inherit a nest egg of cash or investments over an heirloom – and spending it on a house deposit would be the most popular way to use it.
Pensions can now be passed down to family usually free of inheritance tax allowing them to be treated as an heirloom, this could trigger a rise in the number of people seeking the best way to pass down their pension to relatives when they die.
Sean McCann, Chartered Financial Planner at NFU Mutual said: ‘’Pension freedoms have revolutionised the way many people view their pension, rather than a way of saving for income in retirement, many now see them as a very tax efficient way of passing wealth down through the generations’’.
‘’Because of the tax benefits, some customers are choosing to spend money built up in other investments which are subject to IHT and leaving their pensions untouched and treating them as the new family heirloom’’.
‘’There are a number of potential traps with the new freedoms, so it make sense to take advice to maximise the benefit for you and your family’’
Despite the possibilities and pitfalls with IHT, discussing inheritance still remains an unspoken subject for many families.
The financial services provider also found that 79% of people haven’t discussed their inheritance with family.
Sean adds: “When people are planning how to pass on their assets, they often overlook the value of their pensions. We have seen situations where the value of people’s pension funds are larger than the value of their home. The new rules make it easier to pass these on, normally free of inheritance tax.
“Talking to family about inheritance plans can help manage expectations and avoid painful and potentially costly disputes.”
|
