Families hoping to leave money to loved ones could see their plans dashed by a combination of rising household bills, future care costs and big inheritance tax bills.
A survey for St James’s Place shows that more than six in ten high-net-worth individuals believe their ability to pass on assets is being compromised by double-digit inflation.
More than half also fear they will have to use part of their long-term savings to meet social care costs.
Claire Trott, a director at the wealth manager, says many younger people rely on inheriting cash from parents or grandparents.
Of those expecting to receive an inheritance, 40 per cent are depending upon the money to safeguard their future finances.
Feeling the squeeze: Six in ten high-net-worth individuals believe their ability to pass on assets is being compromised by double-digit inflation
Though many older people are struggling to accumulate long-term wealth, inheritance tax is also becoming a major problem.
A freezing of the nil-rate threshold of £325,000 since April 2009 – and until April 2028 – means more estates are being dragged into the inheritance tax net.
Receipts for April 2022 to February 2023 were £6.4 billion – £900 million up on the same period 12 months earlier.
Many households try to reduce inheritance bills by giving money away before they die.
But last week, Revenue & Customs said it had clawed back £700 million from more than 2,000 families after discovering they fell foul of the rules.
