Inheritance tax (IHT) receipts are continuing to climb in the UK, with The Office for Budget Responsibility (OBR) forecasting that IHT will raise a total of £8.7bn in the 2025-26 tax year.
This means more families are considering passing wealth between generations earlier, reflecting a broader shift in how families are thinking about their finances.
As property prices and investment portfolios also grow over time, many are beginning to plan for not just how to manage their wealth today, but how it will be handled by the next generation.
However, while many families focus on the technical aspects of estate planning such as wills, tax allowances and gifting strategies, they are at risk of overlooking the opportunity to involve their children in conversations about long-term financial planning.
There is a massive opportunity for families to involve their children in financial planning conversations particularly as the child will have the option to remain with their parents’ adviser once they are an adult.
How to plan with your family
Bringing your family into discussions about planning intergenerationally do not necessarily mean sharing every detail about family wealth. Instead, they can focus on helping children understand the principles behind your financial decisions.
For example, explaining why certain investments are held, why long-term planning matters, or how wealth is intended to support family goals can help build financial awareness over time. These conversations can also help younger family members understand the responsibilities that come with managing wealth in the future.
It’s no secret that many who learnt how to manage money and build wealth have typically had parents or mentors who discussed finances openly – allowing them to handle spending and saving from a young age.
This is becoming increasingly relevant as IHT thresholds remain frozen while asset values continue to rise. The standard IHT threshold has remained at £325,000 since 2009, meaning more estates are gradually being drawn into the tax system as wealth accumulates.
Financial planners can play an important role in supporting your conversations with family by explaining key aspects of the plan in clear terms, whether that involves investment plans, managing tax or retirement goals.
They can also help you lay out discussions in a way that is comfortable, constructive and proactive.
By involving the next generation early, you can make sure that your wealth is managed responsibly for years to come.