The Great Wealth Transfer: How Families Can Prepare the Next Generation for Inherited Wealth
A substantial amount of wealth is expected to move between generations in the UK over the coming decades.
Property, investments, pensions and other assets accumulated by older generations will increasingly pass to children and grandchildren, either through inheritance or through gifts made during their lifetime.
The figures involved are significant. Research from the Resolution Foundation has estimated that the annual value of inheritances could double over a 20-year period as the baby-boomer generation moves further into retirement.
But transferring wealth successfully involves more than deciding who receives which assets. For families with substantial or complex financial affairs, there is also the question of whether the next generation is prepared for the responsibilities that can come with receiving them.
Why is so much wealth expected to change hands?
Household wealth in Britain has grown considerably over recent decades, with increases in property values, pension wealth and financial assets contributing to the amount held by older households.
The latest Wealth and Assets Survey data analysed by the Resolution Foundation put total British household wealth at £13.6 trillion in the two years to March 2022.
That wealth is not distributed evenly, either between or within generations. However, as older asset-owning households age, a growing share will eventually transfer to younger family members.
Some of that transfer will happen through inheritance. Some families will choose to make gifts earlier, potentially helping children or grandchildren with property purchases, education or other financial priorities.
As a result, decisions about transferring family wealth are likely to become increasingly important for both generations.
Inheriting wealth can create unfamiliar decisions
Receiving a substantial inheritance can quickly change someone’s financial position.
An individual who has previously dealt primarily with their salary, mortgage, pension and savings could suddenly become responsible for a sizeable investment portfolio, property, business interests or other assets.
That can create unfamiliar decisions.
Should inherited investments be retained or restructured? How does the inheritance affect existing financial plans? Should capital be invested, used to repay borrowing or retained for future expenditure? What tax considerations arise?
There is rarely one answer that applies to every beneficiary.
Age, existing wealth, income, family circumstances, attitude to risk and long-term objectives can all affect what is appropriate.
This is one reason preparation before a transfer takes place can be valuable.
Talking about wealth before it is inherited
Families have traditionally found conversations about money difficult, although evidence suggests attitudes are changing.
Investment Association research published in 2025 found that younger generations were more likely to discuss money and finances than their parents’ and grandparents’ generations. At the same time, almost a third of Gen Z respondents and 28% of Millennials said they lacked confidence in managing their current financial situation.
That distinction matters.
Being comfortable talking about money does not necessarily mean someone is prepared to manage substantial capital.
Families do not necessarily need to disclose every detail of their wealth immediately. But discussing the purpose of the family’s wealth, how it was accumulated, and the responsibilities associated with it can give the next generation greater context before they eventually become responsible for it.
Preparing the next generation is not just about investment knowledge
Investment knowledge can be useful, but preparing for inherited wealth goes much further.
Future beneficiaries may need to understand the family’s wider financial arrangements, including property, pensions, trusts, business interests and relationships with professional advisers.
They may also need to understand why particular structures or investment decisions are already in place.
For larger families, questions can arise around how decisions will be made when several family members have an interest in the same assets. Different generations may also have different priorities around investment, spending, philanthropy, or preserving capital.
Addressing those issues while the current generation remains actively involved can make the eventual transition easier to manage.
Should families transfer wealth during their lifetime?
Not all intergenerational transfers happen through inheritance.
Some parents and grandparents choose to provide financial support during their lifetime, particularly where it can make a meaningful difference at an earlier stage.
Resolution Foundation research has previously found that property purchases are an important reason for lifetime gifts, reflecting the difficulty many younger adults face in accumulating a deposit independently.
Transferring some wealth earlier can have advantages, but it requires careful consideration.
The older generation still needs sufficient assets and income to meet its own requirements, including potentially uncertain expenditure later in life. Tax, legal, and estate-planning implications may also arise, depending on how assets are transferred.
A decision to make a substantial gift should therefore be considered as part of the family’s wider position rather than simply as a way of moving assets from one generation to another.
Keeping different parts of family wealth connected
As wealth grows, more people may be involved in managing it.
A family may have investment managers, financial planners, accountants, solicitors and other specialist advisers, each responsible for a different area.
The individual advice provided by those professionals may be appropriate, but families also need to understand how the different decisions interact.
An investment decision can affect estate planning. A substantial lifetime gift can affect the donor’s own financial position. Changes to a family business may influence succession planning. Trust arrangements can involve investment, legal, tax and administrative considerations simultaneously.
For families whose affairs have reached this level of complexity, a Multi-Family Office approach can provide a central point of coordination across investments, financial planning, succession and the wider professional relationships involved in managing family wealth.
The purpose is not to replace specialist advisers. It ensures that decisions made in one area are considered in the context of the family’s wider circumstances and long-term objectives.
The transfer of responsibility matters as much as the transfer of assets
The Great Wealth Transfer is often discussed primarily in terms of its financial scale.
For individual families, however, the more important issue may be how effectively responsibility moves from one generation to the next.
An inheritance can transfer ownership of an asset immediately. Developing the knowledge, judgement and confidence required to manage substantial wealth generally takes longer.
Families that begin those conversations before a transfer occurs have more opportunity to explain existing arrangements, involve younger generations in appropriate decisions and establish how wealth should be managed as circumstances change.
Ultimately, successful intergenerational planning is not simply about preserving a particular collection of assets. It is about ensuring that future generations are equipped to make informed decisions about the wealth for which they become responsible.