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Four out of five over-45s want their inheritance while parents and grandparents are still alive, new research among the well-off older generations reveals.

The money is most likely to be forthcoming if it's for property, with half of those who have already given an 'early inheritance' saying they did so to help family get on the housing ladder.

Among both groups, those waiting for an inheritance and those mulling when best to hand over wealth, 88 per cent said they would consider assisting children or grandchildren to buy a property.

And a massive 97 per cent of those surveyed believe it's now difficult or very difficult for young people to buy a home without family support.

The research was carried out among more than 2,100 subscribers to a newsletter published by independent financial advice firm The Private Office.

Inheritance: Most wealthy over-45s would like to receive it while family members are still alive

The firm explains that those who replied were skewed heavily towards older, asset-rich homeowners, reflecting the type of person most likely to be considering an inter-generational wealth transfer.

Rising numbers of better-off people are thought to be spending or gifting their money during their lives as these are the easiest ways to avoid inheritance tax.

Financial gifts are tax-free if the person giving them survives for seven years after the money is transferred.

If you die before the seven years are up, inheritance tax is levied on a sliding scale – starting at the full whack of 40 per cent if it's within the first three years.

Unspent pension pots will become liable for inheritance tax from spring 2027, upending the plans of many people who saved into them so they could be passed tax-free to the next generation.

They are now casting around for other ways to avoid the 40 per cent levy. HMRC data published yesterday revealed record pension withdrawals in the 2025-2026 tax year, some of which will have been prompted by the new IHT rules.

Will inheritance tax go up?

At present around 4-5 per cent of estates pay inheritance tax at 40 per cent on assets above a certain size – thresholds start at £325,000 per person, or £500,000 if you leave a home to direct descendants, and couples can double those figures.

However, the arrival of Andy Burnham as Prime Minister has led to speculation about an overhaul to pay for social care reforms which could hit more estates.

The Private Office found that while just over half of the people it surveyed made lifetime gifts for property purchases, 20 per cent provided general living support, 8 per cent helped with education costs, 5 per cent with weddings, 4 per cent with debts and 2 per cent with student loans.

The firm cites separate research from estate agent Savills, which said in its 2025 property report that 52 per cent of first-time buyers had received help from their family, with an average contribution of £55,572, in the previous year.

Meanwhile, TPO said in its survey 64 per cent would feel comfortable giving a large sum to family members during their lifetime.

However, among those considering when to hand over an inheritance, fear of running out of money in later life was the most common reason given against doing so.

This reservation was raised by 37 per cent, while care homes costs worried 16 per cent, and suspicions the money wouldn't be used responsibly bothered 12 per cent.

Some 11 per cent were concerned about inheritance tax, 5 per cent about economic uncertainty, and 2 per cent about family disputes. On the other side, 15 per cent said they had no concerns.

The Private Office said some 37 per cent of those it surveyed were aged over 75, 40 per cent were aged 65 to 74, 18 per cent were aged 55 to 64, 4 per cent were aged 45 to 54, and 1 per cent were under 45.

Three quarters had children, grandchildren or both, and in terms of property 91.3 per cent owned their homes outright, 5.5 per cent had a mortgage, 1.4 per cent rented privately and 1.8 per cent had other arrangements.

Daniel Blandford, a partner at the firm, says: '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 adds: '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.'

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