Four fifths of advised clients now recognise the need to prioritise intergenerational planning, a new report has revealed.
According to HSBC Life (UK)’s ‘The Three I’s of Investable Capital 2025’ report, consider the issue ‘highly important’ or ‘important’ (80%).
This figure is up from 75% in 2022.
The bank said the great wealth transfer “presents both opportunities and threats”.
It said the danger over the next 10 years is that financial advisers could lose an estimated £5.5trn worth of assets as they pass from baby boomers to ‘Zillennials’ (Millennials and Generation Z).
At the same time, the intergenerational transfer of wealth is poised to put large sums of money into the hands of those who have never had it previously.
HSBC said advisers can “help ease the transition before it happens”.
Advisers can play an “important role in improving the financial literacy, understanding and confidence” of Zillennials, it added.
Additionally, due to the Budget in October 2024, inheritance tax is receiving more attention.
Chancellor Rachel Reeves froze the IHT thresholds until 2030, which HSBC said “will draw more people into paying this most unloved tax”.
Currently, around 5% of estates pay IHT (rising over the years to 2030 due to the frozen thresholds) but HSBC predicts a much higher proportion of advisers‘ clients will be liable.
HSBC Life believes there should be more conversations with clients around IHT planning.
Government figures show a record £8.2bn was paid in IHT in the year from April 2024 to March 2025, an £800m rise on the previous year.
The report showed advisers are working hard to support clients with IHT and 68% of clients have discussed IHT planning with their adviser.
Advisers are seeing ‘boom in demand’ for IHT advice
Still, less than half (47%) of advised clients have solutions in place to reduce or plan for potential IHT on their estate.
Almost a third of clients (29%) said their adviser has raised IHT planning with them, but they have not taken action.
HSBC Life head of onshore bond distribution Mark Lambert said: “It has never been more important for advisers to actively engage clients and their dependents on intergenerational wealth transfers.
“Record IHT receipts, and demand from clients for support, clearly makes the case for advisers to redouble efforts on estate planning.
“As part of this, we believe advisers will be seriously considering making the fullest use of the relevant tax effective wrappers available, including onshore bonds.
“Combined with an appropriate trust, onshore bonds can form part of a highly tax efficient estate planning strategy with simplified tax administration.”
The report is based on research from 300 advisers and 1,000 clients currently with advisers or who have seen an adviser in the past three years.
