Do you think about your future inheritance? Do you expect to receive money?
Most people assume that they will inherit money in the future, but sadly this is rarely the case. A recent survey from Old Mutual Wealth has found that people between 30 and 45 may be hugely overestimating the amount that they will inherit.
The survey from Old Mutual Wealth analysed a group of 3,000 people between the age of 20 and 45. This group is fairly unique as they are too young to receive large benefit pensions and they are too old to enjoy the full benefits of auto-enrolment.
Around half of this group believed that they would receive an inheritance, and over a third believed that they would receive more than £100,000 as an inheritance.
Sadly it seems that people in this group are grossly overestimating their future inheritances. This is because previous research indicates that less than a third of 50 to 75 year olds receive a pension. Data from the Office For National Statistics also found that just one out of 10 people inherit more than £125,000. This indicates that people between 30 and 45 will receive a much lower inheritance than they are expecting.
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Under 45s are also avoiding saving for retirement
It appears that the same group is also putting off saving for retirement. The survey found that most 30 year olds said that they believed they would be planning for their retirement within the next 10 years, but the survey also found that 45 year olds, on average, still hadn’t started to plan for their retirement. These 45 year olds also didn’t expect to start planning for their retirement for another 5 years on average.
This certainly isn’t promising news, but it isn’t particularly surprising either; according to CNBC, millennials are actually better at handling their money than Gen X and baby boomers.
Thankfully Old Mutual Wealth has suggested a few different ways to address these financial problems. It suggests that 30 to 45 year olds make auto-enrolment contributions, and it is providing more financial advice for 30 to 45 year olds. This could help to improve the finances of people aged between 30 and 45 so they have a comfortable retirement.