A new study from pensions provider Hargreaves Lansdowne has found the British public are relying on intergenerational wealth more than ever, with a fifth of people expect to benefit from a substantial inheritance.
While new rules have taken into account bigger inheritances being able to be passed onto loved ones, there's a number of factors those looking to rely on this money should consider.
At the start of the new tax year the joint inheritance tax threshold was effectively raised to £1m, meaning that a married couple or civil partnership could leave assets between themselves to this value before any inheritance tax becomes payable. The threshold is calculated by doubling the individual Nil Rate Band (2 x £325,000) and the Residential Nil Rate band (2 x £175,000).
There are some criteria to meet in order to claim the maximum allowance; generally the estate of the deceased must include a residential property which has been their main residence at some point, and the value of the estate before reliefs must be less than £2m.
With such a generous allowance now available, it's little wonder so many people are looking to a future inheritance as their pension and security into old age. For younger people in particular who are struggling with high rents, student debt and childcare costs, building up a pension while trying to save for a house deposit may seem impossible. For these people, a future inheritance may seem the only realistic route to a comfortable retirement.
However, as people live longer and healthier lives they may find themselves at retirement age before any inheritance is realised. There's also the possibility of a huge chunk of an inheritnace being absorbed by care home costs, or even that the expected inheritance is diverted elsewhere such as to favourite charity - so an inheritance is never a guarantee.
As always, the answer is to take advice, plan ahead and not to rely on expectation.
Around a fifth of people expect to benefit from a substantial inheritance, with 65pc of those aged between 18-54 hoping to use this to fund their retirement years.