Four out of five people aged over 45 want to receive their inheritance while their parents or grandparents are still alive, according to new research among wealthier older generations.
The survey, conducted among more than 2,100 subscribers to a newsletter published by independent financial advice firm The Private Office, found that housing is the main driver of lifetime gifting. Half of those who have already handed over an early inheritance said they did so to help family get onto the housing ladder.
Among both those waiting for an inheritance and those weighing when to transfer wealth, 88 per cent said they would consider helping children or grandchildren buy a property. And 97 per cent said they believe it is now difficult or very difficult for young people to buy a home without family support.
Housing reshapes wealth transfers
Separate research from estate agent Savills, cited by The Private Office in its 2025 property report, found that 52 per cent of first-time buyers received family help in the previous year, with an average contribution of £55,572.
Daniel Blandford, a partner at the firm, said: "The Bank of Mum and Dad has also become the Bank of Grandparents. We're seeing a genuine shift in how people think about wealth, away from the traditional inheritance model and towards active giving during their lifetime."
"The figures on housing are particularly striking. When almost all respondents say it's difficult for young people to buy without family support, that's no longer a peripheral concern, it's become a structural feature of the property market," he added.
Tax rules accelerate early gifting
Inheritance tax planning is also pushing more people toward gifts made during their lifetime. Financial gifts are tax-free if the person giving them survives for seven years after the transfer. If the giver dies before seven years are up, the tax is charged on a sliding scale, starting at the full rate of 40 per cent if death occurs within the first three years.
Currently around 4 to 5 per cent of estates pay inheritance tax on assets above £325,000 per person, or £500,000 for those leaving a home to direct descendants, with couples able to double those thresholds. The arrival of Andy Burnham as Prime Minister has led to speculation about an overhaul tied to social care reforms that could bring more estates into scope.
Unspent pension pots will also become liable for inheritance tax from spring 2027, upending the plans of many who saved into them expecting to pass the money tax-free to the next generation. HMRC data revealed record pension withdrawals in the 2025-2026 tax year, some of which The Private Office linked to the new rules.
Fear of depleting savings holds many back
Among those still considering when to hand over wealth, fear of running out of money in later life was the most common reservation, raised by 37 per cent of respondents. Care home costs concerned 16 per cent, while 12 per cent worried the money would not be used responsibly. Eleven per cent cited inheritance tax concerns, and 15 per cent said they had no reservations at all.
Beyond housing, the survey found that 20 per cent of lifetime givers did so to support general living costs, 8 per cent helped with education, 5 per cent with weddings, 4 per cent with debts and 2 per cent with student loans. Sixty-four per cent of all respondents said they would feel comfortable giving a large sum to family during their lifetime.
Blandford said: "What our clients tell us is that the desire to give is often held back by anxiety about their own future security. The question isn't always should I give, it's how much can I safely give."
