The value of UK household wealth has roughly doubled compared with incomes in recent decades. Much of this wealth will be passed down as inheritances at the end of life. However, there are reasons to think that wealth transfers made during life could be of growing importance too. As older generations live longer, inheritances will be received at older ages. As younger generations face low earnings growth and high house prices, wealth transfers made during life may be a more important determinant of opportunities and choices. Despite this, a limited amount is known about this during-life intergenerational wealth flow.
At this event, IFS researchers presented the findings of new research, funded by the IFS Retirement Savings Consortium and the Economic and Social Research Council. This research gives a new and up-to-date picture of the giving and receiving of significant intergenerational wealth transfers during life. We examine the change in patterns of giving over time, who gives and receives transfers, and the contribution of these transfers to early-adult-life economic inequalities, and differences in transfer receipt between those from different regions and of different ethnicities. We also shed light on the key life events that may trigger, or be facilitated by, the giving and receiving of wealth transfers during life.
Following the presentation of the research, Lord David Willetts (former Minister for Universities and Science, President of the Resolution Foundation's Advisory Council and Author of 'The Pinch') gave a response to the findings.