We must talk about... money (how very un-British!)

By TP Financial Solutions

25 Nov 2022

tp-financial-april-2022-low-res-13.jpg

This is not an article about inheritance tax planning, per se.  Although, I can certainly help if you want advice on the subject and help you not miss out on the valuable allowances available.  However, this is an article about highlighting the need for families to start a conversation about mmm, mmmm, money. 

It is well known that British people, especially of a particular age, do not like talking about certain topics.  University College London conducted research in 2015, and concluded our personal finances is a more uncomfortable topic for us Brits to talk about than our relationships.1

A survey conducted in 2019 by Lowell, a company which helps consumers and businesses manage their credit position, surveyed 2,000 people about their attitudes towards discussing certain topics. The survey found that religion, mental health and infertility were all more socially acceptable topics than finances and debt.2

And yet, it is estimated that the value of inheritances is set to double over the next 20 years.3  If we extend the time horizon, it is estimated that £5.5 trillion is expected to pass to the next generation over the next 30 years.4 

The recipients of this windfall are expected to be other ‘baby boomers’ and people in the younger Generation X (40- to 54-year-olds) or Millennial age groups, those aged between 25 and 39.5 Let’s just focus on the recipients of these inheritances for a moment.  Data from the Office of National Statistics5 paints the following picture:

Inheritances from spouses of the recipient had the highest value, on average, and were mainly distributed among those aged 55 years and over, Those aged 55 to 64 years were the most likely to receive an inheritance and also received the largest inheritances on average, and Individuals with the most income and wealth were likely to receive the largest gifts and loans, on average.

No surprise in the recipient typically being a spouse, and the spouse also being a baby boomer, as people tend to (but not always) partner with someone of their own age.  It should be remembered; we do live in an era of increasing divorce rates across the different age groups and subsequent re-partnering and second families.  So, choosing who you leave your money to, and how much, is often more complicated than it used to be. The potential for family fallouts is greater. All the more reason to talk about the subject early.

As our life expectancy has increased over the years, then the age of the recipient of an inheritance has also increased.  The baby boomers receiving the inheritance are those people who have enjoyed the greatest increase in the value of their assets, money going to money.

Those leaving the money will no doubt want to ensure that their beneficiaries, be their family, friends and/or charities, enjoy their windfall.  They will also probably wish to minimise the tax man’s take on their bequests in a legal and ethical way.  Figures from HMRC for the 2020/21 tax year show £5.4bn was collected in inheritance tax, an increase of £190m on the previous year.   The receipts from Inheritance Tax have been increasing year on year for some time and look to increase further still.  Inheritance Tax is often referred to as the voluntary tax as there are simple measures to mitigate it, which are often overlooked.

At the risk of raising the elephant in the room…

What would be the benefit of taking the risk, and breaking the taboo of talking about money, either as a parent with your children or a child (and their siblings) with their parents.  Quilter found in their research6 that one in five (18 per cent) of the people in the 55 to 65 (baby boomers) age range who received an inheritance would prefer to pass it on to the next generation - almost immediately.  Remember the ONS data I highlighted previously, money going to money.  Does the recipient really need the money?

Those that do pass on this inheritance pass it straight to their own children (81 per cent). A further 10 per cent skipped a generation and handed it to their grandchildren.

Many 55–65-year-olds have benefited from rising asset prices, (e.g. houses) during their lifetime. Many have enough savings, investments, and other wealth, so may feel that their children or grandchildren need it more than they do.

Instead of thinking of your money as something you leave to your next of kin when you die, why not plan early and support younger family members who have an immediate need for financial support? 

The evidence from the Quilter research indicates that many beneficiaries pass the money on.

If you are thinking of leaving money to specific people, are you sure they really want or need the money, or is there somebody else in the family who could benefit more?  Similarly, if you think you may be in line for an inheritance, but feel your children or grandchildren would benefit more, perhaps now might be the best time to – talk about money.  You might be able to see the recipients enjoy the money you have provided for them.

Whether you are the benefactor or the possible beneficiary, having the conversation now can make sure the money goes to the right person, at the right time and in the right way.

As the old BT advert said – it’s good to talk.

Tax treatment varies according to individual circumstances and is subject to change.

References

1 https://www.independent.co.uk/news/science/talking-about-money-britain-s-last-taboo-10508902.html

2 https://www.thedebtadvisor.co.uk/brits-find-difficult-talk-money-mental-health

3 J Leslie & K Shah, Intergenerational rapport fair?: Intergenerational wealth transfers and the effect on UK families, Resolution Foundation, February 2022

4 Passing on the Pounds report, Kings Court Trust, 2017. Source: Inheritance Economy (kctrust.co.uk)

5 Office for National Statistics - Intergenerational transfers: the distribution of inheritances, gifts and loans, Great Britain: 2014 to 2016 Source: Intergenerational transfers: the distribution of inheritances, gifts and loans, Great Britain - Office for National Statistics (ons.gov.uk)

6 The research was commissioned by Quilter and undertaken by YouGov Plc, an independent research agency. All figures, unless otherwise stated, are from YouGov Plc. The total sample size is 1,544 UK adults, comprised of 529 Baby Boomers, 501 Generation Xers and 514 Millennials. Fieldwork was undertaken between 07/07/2020 - 08/07/2020. The survey was carried out online. The importance of being trusted by your clients’ families | Quilter plc

 

Latest news

1

Call to recognise the ‘Now Generation’ of Lancashire leaders Sub36 event

Call to recognise the ‘Now Generation’ of Lancashire leaders

15 Jul 2025

2

Maya Ellis MP hails A582 upgrade funding as major step forward in tackling transport chaos Maya Ellis MP photo

Maya Ellis MP hails A582 upgrade funding as major step forward in tackling transport chaos

15 Jul 2025

3

TSS announce leadership appointments to drive continued growth James Austin, Alistair Bradley and Michael Collum

TSS announce leadership appointments to drive continued growth

15 Jul 2025

4

Date revealed for opening of entries for Red Rose Awards 2026 Red Rose Awards 2025

Date revealed for opening of entries for Red Rose Awards 2026

14 Jul 2025

5

Northcote celebrates marketing award for the 25th anniversary of Culinary Festival Obsession Northcotes winning awards

Northcote celebrates marketing award for the 25th anniversary of Culinary Festival Obsession

14 Jul 2025

Background image for hub sign up block

LBV Hub

Leverage Lancashire Business View platforms

Post your news
Post your events
Post your offers
Build your network
Improve your SEO
Gain coverage in the magazine
Sign-up
Events
LBV123 July/August Launch Event
Lancashire Business View magazine launch
Networking
16 Jul 2025

LBV123 July/August Launch Event

Burnley College University Courses Building, Burnley, BB12 0AN

08:30 - 10:30

Lancashire Built Environment Conference 2025
BEC 315 X 315 Px
Networking
25 Sep 2025

Lancashire Built Environment Conference 2025

Blackpool Football Club, Blackpool, FY1 6HX

08:30 - 13:00

CMI Level 5 Management and Leadership Course
UCLanAerialCampus.jpg.jpg
LBV Hub Seminars
21 Feb 2025 - 21 Feb 2026

CMI Level 5 Management and Leadership Course

Preston Campus, Preston , PR1 2HE

09:00 - 17:00

CMI Level 5 Project Management Course
UCLanAerialCampus.jpg.jpg
LBV Hub Seminars
21 Feb 2025 - 21 Feb 2026

CMI Level 5 Project Management Course

Preston Campus, Preston, PR1 2HE

08:00 - 17:00

Shaping Preston's future by remembering its past
1750160034867.png.png
LBV Hub Networking
16 Jul 2025 - 16 Jul 2025

Shaping Preston's future by remembering its past

Society1, Coworking Space, Preston, PR1 3LT

18:00 - 20:30

Chamber Summer BBQ
LBV Hub Social
17 Jul 2025 - 17 Jul 2025

Chamber Summer BBQ

The Borough, Dalton Square, Lancaster, LA1 1PP

17:30 - 20:00

BNI presents Lancashire Speed Networking
1.png.png
LBV Hub Networking
17 Jul 2025 - 17 Jul 2025

BNI presents Lancashire Speed Networking

Chorley Football Club, Chorley, PR7 3DU

16:00 - 19:00

The Business Network Central & East Lancashire
LBV Hub Networking
17 Jul 2025 - 17 Jul 2025

The Business Network Central & East Lancashire

Mytton Fold, Langho, BB6 8AB

11:30 - 14:15

Preston Tech Connection: Web3 is Dead. Or is It?
July Longer Banner.jpg.jpg
LBV Hub Networking
29 Jul 2025 - 29 Jul 2025

Preston Tech Connection: Web3 is Dead. Or is It?

Society1, Coworking Space, Preston, PR1 3LT

18:00 - 19:30

Preston Freelancer Meet-Up: July
Longer July Banner.jpg.jpg
LBV Hub Networking
31 Jul 2025 - 31 Jul 2025

Preston Freelancer Meet-Up: July

Society1, Coworking Space, Preston, PR1 3LT

10:00 - 11:30

Advantage: AI – A Workshop for Business Leaders – August 14th
Navy--Event Tile.png.png
LBV Hub Seminars
14 Aug 2025 - 14 Aug 2025

Advantage: AI – A Workshop for Business Leaders – August 14th

Door4 Office, Burnley Wharf, Burnley, BB11 1JG

09:00 - 12:00

The Business Network Central & East Lancashire
LBV Header (24).png.png
LBV Hub Networking
21 Aug 2025 - 21 Aug 2025

The Business Network Central & East Lancashire

Mytton Fold, Langho, BB6 8AB

11:30 - 14:15

Advertise with us

Reaching 50,000 members, our print, digital and event platforms offer a fantastic way to raise your business profile and help you grow.

Find out more LBV122 Online Graphic
Subscribe now

Weekly news bulletin