Schroders Personal Wealth: Four in ten UK adults never discuss later life planning with their children as conversations around money remain difficult
New research from Schroders Personal Wealth (SPW) has shown the difficulties many families have when it comes to talking about their future finances, with some 43% admitting they never discuss later life planning with their children.
The Schroders Personal Wealth Family and Finances Report, which surveyed more than 1,000 parents over the age of 60, lays bare the gap in financial planning when it comes to passing on wealth. An overwhelming majority, 78%, have no estate planning strategy in place. However, most over 60s plan to pass on their wealth to their children after death (72%), with just 13% saying they would do so during their lifetime.
It’s a similar story for those passing on assets to grandchildren. More than half (53%) will do so on their death, only 12% say they plan to do so during their lifetime.
Family communication and money taboos
One clear theme from the report was the seeming reluctance to discuss estate planning and the passing on of wealth with children.
Some 65% said they rarely or never discuss inheritance with their children. Of the fifth (22%) that do have an estate plan in place, less than half (48%) say their children know exactly what the plan is. While parents are reluctant to discuss estate planning with adult children, there’s an appetite among them to teach their children about money matters in general when they are young.
When roles reverse
The report also sought the opinions of 1,000 UK adults aged 30-59 with at least one parent alive to see how they felt about handling their parent’s finances when they are no longer able to do so.
While some are engaging with their parents about their financial future, many are daunted by the prospect of dealing with the unknown. A third (32%) admit they are worried about the prospect of managing the finances of their parents if they are no longer able to do so. The main concern is feeling overwhelmed by merely the thought of managing their parent’s finances with 41% saying this was a worry for them.
Commenting on the survey results, Marcelo Rodrigues, Head of Business Development at Schroders Personal Wealth in Scotland said:
“Family conversations around wealth transfer have never been so important. As the Baby Boomer generation continues to mature, between now and 2055 over £5.5 trillion of wealth will be transferred on to the next generations in the UK.
Our report shows that many families have difficulties talking about money, but having a financial plan in place is crucial to pass wealth on efficiently, avoid family disputes and minimize the tax bill.
At Schroders Personal Wealth, we stand ready to support families and individuals on what can be a very sensitive area of financial planning.”
For further information, please contact:
Marcelo Rodrigues | Head of Business Development, Scotland.
firstname.lastname@example.org/ Scottish Regional office: 0131 376 1815