Gen-Z banking on Mum and Dad

The pension changes related to inheritance coming in April 2027 seem to be leading to more parents considering giving their loved ones their inheritance with a warm hand rather than a cold one. One consequence is that it doesn't foster the best behaviours in individual financial planning. It's usually in the forties that people take more notice of pension planning, but the parents can instil the benefits of starting as early as possible. A lot of the parents' wealth could have been built up within their pensions, and the parents should instil the same in their children. But for generations that have been trained on instant gratification from computer algorithms, this can be hard.

This is not something that resonates from conversations we are having with clients although we work mainly with professionals and business owners.

Speaking with many professionals, we are seeing a trend where individuals in their mid 30's have the ambition of being financially free by the time they are 50 or 55 and they are seeking advice in order to achieve this.

The conversations are around how they can build up a structured plan to ensure they can generate passive income by the time they reach this age. For example one client who is 35 and has a senior leadership role had surplus income along with some pension savings. We helped them build a laddered financial plan, underpinned by cash flow modelling. This used a combination of ISAs, Pensions and other solutions to ensure they could achieve their goal by 50, without any inheritance expectations.

Yes, I am seeing younger clients think differently about retirement, but I would not say they are lazy or careless. Many Gen Z and millennial clients are dealing with rent, house prices, student debt, childcare costs and a cost-of-living cycle that makes retirement feel very distant.

The danger is when expected inheritance becomes part of the plan rather than a bonus. I always tell clients: inheritance is not guaranteed, not controlled by you, and not always received at the time you need it. Parents may live longer, need care, remarry, gift differently, spend more in retirement or face inheritance tax issues.

A future inheritance can be included as a possibility, but it should never be the foundation of a retirement strategy. The foundation should be what you can control: pensions, ISAs, protection, cash reserves and sensible long-term planning.

Relying on inheritance is not financial planning. It is hoping someone else’s life, health and decisions line up perfectly with your future

Inheritance is not a pension.

While some younger clients are placing less emphasis on retirement planning, I would be cautious about assuming they will inherit enough to bridge the gap. The size, timing and even existence of an inheritance are uncertain. People are living longer, care costs can be substantial, and estates are often divided between multiple beneficiaries. Even where money is eventually passed down, it may arrive decades later than expected. I encourage clients to treat any future windfall as a bonus rather than the foundation of their retirement plan. Financial independence is built on what you can control today, not on assets that may arrive later, in a different amount, or not at all.