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Millions of Brits relying on inheritance windfalls

5th August 2015 Print

One in three working Brits (35%) are relying on inheritance in order to achieve a stable financial future, but they could be in for a shock, according to a new study.

The research, by retirement specialist LV=, shows millions of Brits are banking on an inheritance to provide them with financial assistance, with this cash windfall often key to their retirement plans.

The most common thing that Brits say that they would do with an inheritance is to pay off their mortgage and clear other outstanding debts. One in six people (16%) would use inherited funds to bolster their retirement savings.

Unfortunately, for those individuals that are hoping to be left an inheritance, the number of people leaving significant amounts to the younger generation is falling, with most people are leaving less or nothing at all4.

According to LV=’s research, a quarter of retirees (28%) say they don’t expect to leave much to their children. A fifth (20%) say they intend to spend their money enjoying their retirement rather than leave it behind and 4% say they will follow Bill Gates and Warren Buffett’s lead and leave their cash to charity.

Without such help many working people admit that they would be unprepared for their later years. One in five (20%) say they will struggle to retire comfortably without inheriting and a quarter (25%) will have to work longer than planned should they not receive such a windfall.

John Perks, Managing Director of LV= Retirement Solutions, said: “People now spend almost as long in retirement as they do in the workplace, so it’s worrying to see that many people say they are reliant on something essentially out of their control to provide them with a comfortable retirement. With all the everyday demands on our time, retirement planning is often at the bottom of the to-do list, but it is important that people take steps to secure themselves the lifestyle they hope for in retirement. We would encourage people approaching retirement to seek advice to get the most out of their pension savings.”