Millennials Have Unrealistic Hopes For Inheritance

Millennials relying on an inheritance to help them buy a home have an unrealistic outlook, according to a new survey.

Researchers found one in seven young adults were waiting for an inheritance before they reached the age of 35, even though the usual age to receive an inheritance is between 55 and 64 years old.

The average amount they are relying to get is around £130,000, but the average inheritance is only £11,000, says the report from wealth manager Charles Stanley.

Many millennials are disappointed when they do not inherit the cash that they believed was due.

“People are living longer than ever, so relying on an inheritance to get on the housing ladder is a risky strategy as you may get less, and much later than planned,” said John Porteous, from Charles Stanley.

Plans to buy a home dashed for many

“Most people save and invest to get on the housing ladder. Starting early and planning ahead is essential to achieving the deposit you need.”

The research highlighted 22% of millennials were waiting for an inheritance as a deposit for buying their first home, but only 7% inheriting spent the money on a home.

The firm’s research also suggests more parents should talk to their children about their wills and inheritances.

Only one in four have had such a discussion, says the research, while a third of parents have made a will, 36% have appointed their children as executors but only one in three know the plans their parents have made for when they die.

Taboo of talking about death

“The most common reason for not discussing inheritance is because the subject is awkward, an excuse cited by 14% of parents,” said Porteous.

“This can lead to family friction and cause resentment, with  62% of millennials saying they would be unhappy if their parents favoured their siblings by leaving them more in their wills or left them out altogether and would feel betrayed, jealous or financially insecure; despite this 19% of parents may not divide their estate equally amongst their children.

“Parents may also be creating further family tensions by unequally passing on gifts throughout their lifetime, which are not being offset against future inheritances.”

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