A large inheritance, warned Victorian novelist Charles Dickens, is one of man’s chief corrupters. Great Expectations is his cautionary tale, as sweet protagonist Pip, believing he is the sudden heir to a fortune, abandons his humility and life-long friends.
It’s an idea that holds little sway with most middle-class Britons today. But London-based Andy, 79, is not one of them. He and his wife do not plan to leave their four adult children an inheritance. Instead, the couple have spent what’s left of their funds, sailing and travelling the world before they “pop their clogs”.
“For me, it’s about equality of opportunity and fairness. It seems unfair that some kids get huge assistance while others get nothing,” he says. “We’re arranging our finances so they have just enough to bury us.”
Andy, who asked us not to use his surname, worked in public education and retired in his early 50s. He says he’s politically “leftwing-ish”, but his views aren’t just about politics — it’s also a question of parenting.
“I don’t want to be a helicopter parent . . . I hate when I see kids who are 40 and their parents are still looking after them.”
It’s a noteworthy stance, given the monumental wealth transfer that’s expected globally over the next few decades. A record £5.5tn in wealth is due to be transferred to the next generation in the UK alone. With over 90 per cent of the country’s wealth currently held by Generations X and older, many Boomers and millennials are set to become “inheritance millionaires”.
Yet Andy is not entirely alone. In the US, a 2015 survey by HSBC found that one in four Americans planned to spend their money rather than pass it down, a phenomenon known as SKIs — “spending the kids’ inheritance”. A Hargreaves Lansdown survey in 2021 found around 11 per cent of parents in England choose not to leave an inheritance to their families. (In Scotland, their forced heirship rules.)
Their motivations range from hedonism (wanting to spend the money themselves), not wanting to spoil their children, or philanthropy. Others — such as actor Daniel Craig — say they simply find the concept of an inheritance “distasteful”.
I should mention here that my own parents also belong to this contrarian group. Since as early as I can remember, I’ve known they don’t believe in leaving a large inheritance — something my dad has spoken publicly about himself. They have instead pledged the overwhelming majority of their wealth to their charity, The Safer Roads Foundation, along with other humanitarian causes.
The Bank of Mum of Dad has taken excellent care of my sibling and me (including generously paying off our student loans, and allocating funds for a future deposit on a flat — both immense gifts, and more than many will receive in inheritance). So now, it’s pretty much closed for business.
To be clear, they haven’t cut us out in anger. Nor are they Marxists — politically they’re pretty centrist. They simply feel that there are life-saving causes that will benefit from their money more than their two well-educated adult children.
Renaissance philosopher Niccolo Machiavelli once wrote that “A son can bear the loss of his father . . . but the loss of his inheritance may drive him to despair.” For anyone wondering if I’ve succumbed to despondency, fear not: I’m genuinely proud of my parents’ legacy. I feel incredibly fortunate for the support I’ve had during their lifetime. There’s a silver lining too, in that I won’t be at risk of any familial angst once they die (40 per cent of people report conflict over inheritances).
If anything, I’m intrigued as to why it’s so provocative, especially among their peers. On the rare occasions that it’s come up, I’ve encountered shock or thinly veiled criticism of my parents. Sometimes I’m met with reassurance that I am in fact in their will and this is a motivational ploy (I checked. If it is a bluff, they’re not breaking the act yet).
Andy also says his friends have been critical of his stance. That’s despite all his children “landing on their feet.”
“People are horrified,” he says. “That includes my well-balanced friends . . . They can’t understand it.”
Online forums froth with furious commentators wondering how people can “watch their kids living in a ‘hole’ while they go and enjoy their cruises.” Anonymous op-eds voice dismay over parents “selfishly” spending their inheritance. There is near delirium each time a member of the super-rich — including Bill Gates and Michael Bloomberg — publicly vows not to leave their wealth to their offspring. Sure, there’s being charitable, they say, but to such extremes?
Fundamentally, wanting to shrink your children’s inheritance is seen as counter to the primitive desire to protect one’s offspring — no matter how well off they are. The majority of people are dedicated to hoarding for their family, with more than £100bn inherited and gifted in the UK alone each year, according to Demos, a think-tank.
“Taking care of the kids is the cultural norm. So it’s countercultural if you will,” says psychology professor Janet Reibstein and author of Good Relations. “It’s seen as neglecting the natural role of parent and child.”
It’s a luxury itself to contemplate trimming your will, given many families are scared they won’t get a choice amid rising social costs. Fewer than 30 per cent of Brits expect to benefit — or have benefited from — an inheritance, according to a 2022 YouGov poll. The ONS reported that the median inheritance for those who received one was £11,000 (this excludes lifetime gifts), and on average occurs in one’s 60s.
Indeed, political interventions that limit the wealth that’s passed down tend to spark controversy, including recent reforms to UK inheritance tax (IHT), often described as “Britain’s most hated tax”. Today, around 4 per cent of estates are affected by IHT — charged at 40 per cent on any part of an estate worth over £325,000 (or over £1mn when a main residence is passed down to children and reliefs are pooled with a spouse). The decision to include pension wealth within the scope of IHT from 2027 has come under fire from some corners of the media, while ending the exemption of agricultural property from IHT caused farmers to march on Downing Street.
Inheritance naysayers have a simple argument: lots of money isn’t always the best thing for us. It can damage people — and wealthy kids need specific guardrails, a theory exposed by the Carnegie Conjecture, which holds that people receiving a substantial inheritance are much more likely to leave the workforce. The party line is that guardrails are crucial, whether parents are handing over life-changing amounts or just a generous leftover that might ease their children’s paths.
In other words, it’s tough love.
Joe Reilly, an adviser to US family offices and host of The Inheritance Podcast, says too much money is a real concern.
“It’s a source of anxiety for parents, knowing their children are growing up in affluence . . . It can impede their search for internal meaning,” he says. “Wealth doesn’t have to deprive motivation, but getting rid of all the challenges does.”
Sarah Coles, a personal finance analyst at Hargreaves Lansdown, says hyper-successful entrepreneurs in particular want their children to make their own way (though this is softened with substantial gifts during their parents’ lifetime).
Part of the issue, according to Reilly, is that inheritance was historically reserved for the aristocratic class, who would reserve “a lot of time and effort” learning to adapt to a big wealth influx, including focusing on public service — though many still squandered it. Today, inheritance comes to broad swaths of the middle class, who have little or no training.
Receiving a hefty inheritance can come with real baggage, says author Eliza Filby. In her book, Inheritocracy she cites several examples of people who inherited large sums who felt guilt, and a loss of meaning. There’s a danger of “economically infantilising” your offspring too, she says, especially in light of the “nepo baby” debate.
To counter this, family office adviser Elena Nuñez Cooper works with clients to adopt a policy of “severe responsibility” with their children. This includes teaching them tough financial lessons from a young age and training them to be philanthropists. It also means managing rich people’s funds so they “die with zero”, with the majority allocated to a charitable foundation — ideally led by their conscientious, financially savvy children.
“Kids do not benefit from an attitude of ‘you’re going to inherit later’,” Nuñez says. “I work with the children of billionaires who have everything, and they’re a lot worse off in the long run.”
For parents it can be a big ideological step to consider trimming their children’s or grandchildren’s inheritance instead of boosting it — even if they are well set up.
It’s perhaps an even tougher pill to swallow for the offspring expecting to receive a chunky inheritance, says financial psychotherapist Vicky Reynal. “We all have a normal amount of greed,” she says. “Most people want to be wealthier.”
The framing around cuts in inheritance is therefore key. This includes “highlighting that it has nothing to do with not loving or caring about them,” Reynal notes. Their responses may vary depending on the individual’s maturity and how early on these expectations are set.
Professor Reibstein goes further. She says that families where there’s little philanthropic precedent will need to work hard to rewrite their “culture” if they want to take this route — otherwise, “your children will feel it as a blow.”
Hargreaves Lansdown analyst Cooper stresses that it doesn’t have to be all or nothing. Simply, leaving your kids everything doesn’t have to be the default.
“You can think about giving them comfort without spoiling them,” she says. “There’s an element of adding to their quality of life versus taking away the impetus to work.”
Whatever route you choose, however, experts agree: communicate your wishes early. Emotionally, being disinherited without being told can be devastating. But the other danger, Cooper says, is people can be in for a financial shock when an expected inheritance doesn’t materialise.
“You absolutely cannot rely on an inheritance,” she warns.
Still, it’s hard to escape the fact that for many an inheritance can make an outsized difference, especially in light of rising house prices — the average first-time buyer deposit in London is now over £140,000, according to Zoopla — and diminished pensions. That includes segments of the middle class, many of whom are poorer than their parents. Inheritance is bridging that intergenerational gap, says Filby.
“Whether or not you’re from a wealthy family . . . [inheritance] is more important in determining your lifetime income than it has been in the past,” says David Sturrock at the Institute for Fiscal Studies.
The IFS forecasts inheritance will make up a record average 14 per cent of lifetime earnings for the 1980s-born generation. That means for some families, an inheritance will dictate whether they own a house, clear their debts, or can retire comfortably, Sturrock explains. In rare cases, it could be a pathway to social mobility.
Yet few born into the top quartile can make that argument. Statistically, most adult children in this camp will enter their 40s with a decent income and firmly on the housing ladder — often funded by historic parental gifts. A bulky inheritance in this group’s case has been described as insurance against calamity, or laziness.
For Andy, this is precisely the problem.
His advice is to think about inheritance as a sporting analogy. Imagine, he says, if there was a rule in F1 whereby if you won the first race, you’d do five fewer laps in the next race. You’d probably win again, and allowed five fewer laps again, and so on.
That’s what leaving an inheritance does to our society, he argues.
I temper that people might struggle to take affirmative action when they see all the other kids getting to skip five laps. Isn’t it hard to make yours the odd ones out?
“Well,” he laughs. “I just say, you should have brought them up better then.”
