How do I prepare my family to inherit my wealth?

Tom believes there’s no single right time to start talking to children about inheritance, but putting the conversation off indefinitely can create problems if something unexpected happens.

“The argument ‘I’ll tell them when I get older’ doesn’t really hold water. What if you suddenly became incapacitated and were no longer able to manage your financial affairs?”

This can be particularly relevant if your children have already been appointed as attorneys under an LPA.

“If they’re the attorneys, as is often the case, they suddenly have responsibility for financial decisions while knowing relatively little about the assets involved, how they’re managed or who normally provides professional advice,” explains Tom.

Tom is keen to stress that they might not need to know every financial detail, but understanding what exists, where important information is held and who to contact could make an already difficult situation a little easier.

Not necessarily. Preparing children for inheritance doesn’t have to mean disclosing the exact value of your estate.

“You don’t have to tell your children exactly how much there is. The important thing is that they have some understanding of the finances and what they may one day need to deal with,” says Tom.

Tom often notices a contradiction when parents consider making substantial gifts during their lifetime.

“Parents sometimes say they’re not sure whether their children would be able to deal with that amount of money, yet their wills leave everything to the children. So if they died tomorrow, the children could receive considerably more. And very often those same children are also the attorneys who may be expected to deal with everything if their parents lose capacity.”

If you have concerns about how your children would deal with inherited wealth, it’s worth starting that conversation before they receive it.

Intergenerational wealth planning isn’t only about tax, investments or legal structures. It can also help the next generation understand what the money represents.

That can be particularly important where wealth has been built up over several generations.

“If a grandfather worked hard building a business that created the family wealth, understanding where that wealth came from can help children see the inheritance from a personal perspective rather than just as money.”

Tom knows parents who see themselves as custodians of wealth that has been built up over generations, with a responsibility to preserve it for those who come next.

That can make conversations with adult children less about the size of a future inheritance and more about the role they may one day play in looking after it.

“For some families, it’s about helping the next generation understand where the wealth came from and what it represents. For others, it might mean explaining what they hope the money will eventually achieve – perhaps greater financial security, helping future generations or creating opportunities that weren’t available to them.”

Those conversations can’t dictate what adult children ultimately do with an inheritance. But they can give them context.

It can be useful to arrange a meeting if your children may later need to act under a power of attorney, support a surviving parent or make decisions about inherited assets.

If one parent has always taken responsibility for the family finances, for example, involving adult children can give them enough familiarity with the arrangements to support the other parent should anything happen.

Tom says introducing children into the conversation can sometimes require a sensitive approach. “With an elderly parent who has always dealt with their own finances, suggesting that the children get involved can sometimes be taken as a criticism that they’re no longer able to look after things themselves. Framing the conversation around continuity rather than control can help.”

The aim is not to hand financial responsibility to the next generation before it’s necessary. It’s to make sure they know who to turn to and understand enough of the bigger picture if circumstances suddenly change.

“There can also be value in maintaining continuity with a trusted financial planner,” says Tom. “Over many years, advisers often build relationships not only with clients but also with their wider families. If children later need advice following a death or incapacity, they already know someone who understands the family’s circumstances and financial history, which can make that transition easier.”

Tom has witnessed this play out when helping families with inheritance tax planning.

“I’ve seen a number of cases where the parents were initially reluctant to involve their children, but where the planning involved trusts. Additional trustees were needed, and the children were the obvious choice. That created a reason to explain not only their responsibilities as trustees, but why their parents were putting the arrangements in place.”

Tom says these conversations often produced an unexpected result. “In many cases, the children hadn’t realised how much their parents had accumulated. Rather pleasingly, their response was to encourage their parents to enjoy more of their own money, whether that meant small things like finally replacing the living room carpet, or bigger things like taking the holiday of a lifetime, buying a new car, or moving home.”

It’s a useful reminder that talking about inheritance doesn’t automatically make children more eager to receive it. Sometimes it gives them greater confidence that their parents can afford to spend more on themselves.

There’s no single right time to start talking about inheritance, and every family will feel differently about how much information to share.

What matters is avoiding a situation where the first time your children properly understand your financial situation and its potential impact on them is when something has gone wrong.

An independent financial planner can help you consider what your family needs to know, when to involve them and how wider inheritance or gifting decisions fit alongside your own long-term financial security.

Planning how wealth will pass to the next generation is only part of the picture. Preparing the people you’d like to receive it matters just as much.