One in five has had problems with their family over inheritance… here’s why it pays to be transparent

Avoiding inheritance conversations is increasingly causing divisions between family members, with almost a fifth of people saying they have had to deal with a dispute, research seen exclusively by This is Money shows.

According to the Canada Life study, up to 18 per cent of people have argued with other family members about what they inherit.

Meanwhile, a quarter said they hope that not addressing the issue will cause problems in the future.

Five percent of people even said they had tried to broach the topic with family members but they wouldn’t discuss it.

This comes despite 60 per cent of people believing that being open with their family would help them understand the situation and 41 per cent believing it would reduce the likelihood of legal problems in the future.

And yet, as many as 29 percent said they don’t want to talk about inheritances because they are “too far in the future,” a quarter said they don’t want to think about it and a fifth said it’s their business to deal with it alone. .

Stacey Love, tax and estate planning specialist at Canada Life, said: ‘Discussing inheritance can be a challenge for many families, and some believe avoiding it can help maintain harmony in the short term.

“However, our Life100+ research reveals that avoiding these conversations often leads, or has the potential to lead, to conflict within families.”

While inheritance disputes can create significant divisions within families, they can also be tremendously costly.

Many cases do not go to trial, in fact only 2 percent do, but for those that do go to court, the costs can be high.

While some attorneys will take a no-win, no-fee case, staff contesting the will would still be responsible for paying the defendant’s legal costs if the plaintiff loses the case.

Even if the matter does not go to trial and is resolved through mediation, this could cost you thousands of pounds.

Inheritance disputes have become increasingly common in recent years, and the transfer of wealth from the baby boom generation combined with a rise in second marriages demonstrates the root cause of this.

These disputes often arise as a result of someone being left out of a will, someone dying without having written a will, and disagreements between executors.

Love said: ‘To prevent these problems, we need a shift towards transparency. It is encouraging to see that more than two-fifths of people plan to talk about inheritance more openly than previous generations, breaking the taboo around inheritance and future life planning.

‘Open conversations can ensure intentions are clear, reduce potential conflict, and better prepare loved ones for the future. By encouraging a more open approach, families can build stronger relationships and reduce misunderstandings over time, as well as feel more in control and satisfied with the results.’

Although many have reservations, more than a third understand that open conversations can ensure that assets are distributed fairly, conflicts can be avoided and, as a result, family members can better plan their finances.

Younger generations are becoming more open with their money

It appears that younger generations are more willing to be open with their plans for the future: 43 percent of people plan to discuss their inheritance plans.

This change in opinions is largely due to the younger generations’ own experiences with older family members who are unwilling to address the issue of inheritance.

A tenth of people said they do not talk about finances with their family, and the figure rises to 13 per cent among those aged 55 and over.

Despite this, Saltus data indicates that those under 25 are twice as likely to talk about their salary with their friends: 35 per cent share their salary with close friends, compared to just 18 per cent of those over 55 years of age.

Similarly, around half of 18- to 24-year-olds have told their partner what they earn, while less than a third of those over 25 have.

Megan Jenkins, chartered financial planner at Saltus, said: “The openness of younger generations to talking about money is a real cultural shift. This is likely to have been driven by a number of factors, including social media, economic pressures and the search for justice.

“Unlike previous generations who avoided talking about finances, Gen Z sees profit sharing as normal, influenced by social media content creators who post content sharing their jobs, industries and salaries, and encourage their followers to have open discussions about fairer finances.

Have you had an inheritance dispute? Get in touch: editor@thisismoney.co.uk