UBS Wealth Management Americas (WMA) today released its quarterly UBS Investor Watch report, exploring the issues around inheritance and why families avoid the topic. The survey of over 2,800 high net worth (HNW) and affluent U.S. investors found that while both benefactors 1 and heirs 2 are optimistic about giving and receiving inheritance, neither is actively engaged in inheritance planning and are reluctant to fully discuss this topic before a death in the family occurs. As a result, almost half (46%) of benefactors have not discussed their inheritance plans with their children. With an estimated $40 trillion of personal wealth expected to change hands by 2050 3, there is a lot at stake and a lot to talk about.
Top barriers to the inheritance conversation
With benefactors not wanting to divulge their wealth and heirs being afraid or unwilling to raise the topic, the inheritance conversation is one of the most important family discussions that does not take place. For those leaving an inheritance, their top three barriers to discussion are:
- It doesn't feel like a pressing issue (43%),
- They don’t want their offspring to count on the inheritance (32%), and
- They don’t want their children to feel entitled to wealth (27%).
Three in four benefactors also view it as highly important that their children use their inheritance wisely and don’t squander it.For those on the receiving end of a potential inheritance, their top barriers are:
- Their families don’t talk openly about financial issues (46%),
- It does not feel like a pressing issue (31%), and
- They do not want to appear greedy (23%).