More than 20% of people have lost a pension pot says expert
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These days many rely on inheritance to pay their way through retirement as the cost of living and longer life spans continue to rise. But there is a key mistake many younger generations make when it comes to saving for retirement – and that’s relying on those that come before you.
The most common age at which current 25 to 30-year-olds will inherit money is 61, according to the Office for National Statistics (ONS).
However, the chances of this changing are high, making relying on money that doesn’t belong to you even riskier than it already is.
In 2019, more than 13,000 people lived beyond their 100th birthday.
This suggests their children may be well into their 70s before they inherit.
Making this one inheritance mistake could leave your retirement in ruins (Image: GETTY)
Many tend to rely on older generations to boost their retirement income (Image: GETTY)
No one can accurately predict how long their loved ones will live, unless they have serious health issues or are given a terminal diagnosis, making it even less wise to rely on inheritance for retirement costs.
Another key reason younger generations shouldn’t rely on their elders for a bolstered sum is due to the rising cost of care.
Later in life care costs have skyrocketed, with the cost of nursing care increasing by 15 percent over the last five years.
Extensive care costs can run up to £100,000 per year, potentially wiping any inheritance whatsoever from the family slate.
The amount pensioners have in their pockets has stagnated in recent years (Image: GETTY)
To add insult to injury, household costs have risen more for pensioners than any other age group, according to recent data from the ONS.
Pensioners’ average income, after housing costs and direct taxes, has remained stagnant over the past decade.
Average total income has risen slightly from £319 to £331 per week, according to the Departments for Work & Pensions.
Things don’t seem to be getting easier for those in their twilight years anytime soon – and this bad luck is likely to trickle down to those that come after them.
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State pension is one form of income for older generations (Image: EXPRESS)
The rumoured scrapping of the triple lock for pensions will also make a huge dent in the incomes of millions of pensioners who rely on the state pension to see them through the week.
Some estimates predict pensioners could lose up to £11,000 per year if Rishi Sunak changes or axes the guarantee, designed to make sure the elder generations see their pension payments rise each year.
Consumer group Which? has estimated the cost of a happy retirement at £305,000 – when the median inheritance received is £11,000.