The majority of financial advisers are concerned about losing assets in the ‘great wealth transfer’ as trillions of pounds will be handed down to future generations.
Scottish Widows’ Investor Confidence Barometer showed that 91% are worried.
It also found 57% of advisers expect to retain services for a minority of their clients’ dependents upon the death of the client.
Almost three quarters (74%) of advisers revealed they had a dedicated intergenerational planning strategy in place for the majority of their clients.
However, this leaves 26% of advisers who do not have a clear strategy.
The report reveals that although 75% of advisers believe it is important to create relationships with their client’s children, only 17% have established a connection.
When it comes to client’s grandchildren, only 12% of advisers said they have established a relationship with them.
Scottish Widows said inherited wealth tends to pass to the client’s widow, only 26% of advisers have a relationship with spouses.
This, it adds, “is also an area where deeper engagement could be prioritised”.
The greatest barrier to creating links to younger generations is their scepticism towards the value of financial advice, said 70% of advisers.
The second biggest challenge (65%) is the difficulty advisers perceived in discussing a client’s death with their children.
Similarly, 41% only talk about estate planning at or after retirement, with 24% waiting until the client initiates the conversation themselves.
Overall, 21% said it will only be discussed when the client becomes seriously ill.
Just under half (48%) of advised clients said they were willing to pay for their children’s financial advice even before they have any notable assets.
Scottish Widows intermediary distribution director Ranila Ravi-Burslem said: “Intergenerational planning is such an important topic, and it’s one that we’re really committed to supporting our advisers on.
“Our survey results suggest that there is scope to dial up engagement with dependents but, crucially, emphasises the need to have earlier conversations with clients about estate planning.
“With the ability to pass pension wealth down the generations, advisers must ensure their clients not only have their beneficiary nominations in place, but that these are regularly reviewed as circumstances and priorities can change.
“Advisers should also to look to engage with named beneficiaries early, so that things run smoothly when a client’s family most needs it to.”
The Scottish Widows Investor Confidence Barometer is a twice-yearly survey of over 1,500 people conducted by Censuswide for Scottish Widows Platform.
The survey, which was conducted during September 2023, was split into 502 advised consumers, 500 non-advised and 500 financial advisers.
