Business

Millennials 'wrongly relying on inherited money'

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Some millennials have unrealistic expectations of inheritance and how it may unlock the door to buying a first home, a survey suggests.

One in seven young adults expect to inherit money before they are 35, although in reality the typical inheritance age is between 55 and 64.

The survey, by wealth manager Charles Stanley, suggested that young people expected to receive nearly £130,000.

However, the median average amount handed down was only £11,000.

Advisers said that relying on an inheritance to pay a deposit for a first home was often misguided, even if older family members intended to pass on money when they died.

"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.

"In reality, 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 suggested that 22% of millennials expected to receive inheritance to use as a deposit, although official statistics suggest only 7% actually did so.

The average expectation of when that inheritance would be received was the age of 50, yet figures from the Office for National Statistics (ONS) show that they would have to wait for at least another five years.

Even when that money arrived, ONS data showed that inheritance was much less lucrative than many asked in the survey expected.

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Others in the industry have argued that the UK public is "largely ignoring" financial planning for death.

Dan Garrett, founder of will writing service Farewill, said that 30 million people in the UK had not written a will, partly because it had dropped down the household "to do" list.

He also called on the government to clarify its plans for probate fees.

The government is planning to substantially increase the cost to bereaved families of settling the estates of deceased relatives.

The changes were expected to start last month but have been delayed.

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