In a generation of non-savers, it is more important than ever for parents and grandparents to leave a Will that minimises inheritance tax and makes sure the right beneficiaries receive what they are supposed to get.
Figures from The Share Centre show that one in ten people have no savings plans in place at all for their retirement, while 53% of people use an ordinary savings account to set money aside.
The list – which includes several methods of saving that are not mutually exclusive of one another – also recognises that 40% of people save into a cash ISA, while 39% have a workplace pension that benefits from employer contributions.
However, inheritance remains a crucial contribution to many people’s retirement plans – which might seem sensible, as the finances not used in their parents’ twilight years could feel like a reasonable way to top up the child’s life savings.
More than half of the people surveyed by The Share Centre said they would like to be able to leave an inheritance to their children, and this figure reached 64% among people aged 65-74.
Interestingly, one in nine (11%) of the younger people surveyed agreed with this approach, saying that they hope an inheritance will effectively bail them out of planning for their own retirement.
Richard Stone, chief executive of The Share Centre, said: “Even if you are left a healthy inheritance it’s unlikely to fund your whole retirement, which could last 30 years or more.
“Indeed with increased life expectancy more and more individuals will have already retired before they inherit, to say nothing of where this approach will leave the next generation.”
Amid this financial climate, and particularly in light of the uncertain economy and diminished ability for many younger people to save, parents who want to maximise the inheritance they leave behind must ensure they have a properly written Will, complete with the appropriate estate planning to minimise their exposure to inheritance tax.
This not only protects your loved ones to make sure they get what they are due – it also lets you feel more certain that your affairs are in order, so that you can enjoy spending what money you have in the bank for yourself during your retirement years.