The Great Wealth Transfer: What £5.5–£7 trillion passing between generations means for UK families

The Great Wealth Transfer is the movement of wealth from older generations, mainly Baby Boomers, to their children and grandchildren. Industry estimates put it at between £5.5 trillion and £7 trillion over roughly 30 years. For most families, the headline matters less than the timing, the tax position and whether the right conversations have happened.

Behind the trillions are very ordinary decisions. A grandmother working out whether she can afford to help with a house deposit. A son who isn’t sure what his parents want and doesn’t like to ask. A couple in their sixties who would quite like to spend some of their own money before they pass it on.

This guide explains what the Great Wealth Transfer is, where the big numbers come from and how far to trust them, what the latest HMRC figures say about Inheritance Tax, and how to prepare whether you expect to give or to receive.

This article reflects UK rules and data as at 7 October 2026, three weeks before the Autumn Budget on 28 October. Where a change is already legislated for a future date, we say so.

What is the Great Wealth Transfer?

The Great Wealth Transfer is the passing of wealth from older generations, mainly Baby Boomers (born 1946 to 1964), to Generation X, Millennials and Gen Z through inheritance, lifetime gifts and estate planning. It’s driven by an ageing population, decades of rising property and pension values and longer lives, which means wealth often changes hands later than people expect.

One industry estimate, reported by Unbiased, puts the Baby Boomer share of UK wealth at around 52.5% in 2020, or about £5.1 trillion.

How big is it, and how reliable are the numbers?

The most quoted estimate is £5.5 trillion to £7 trillion over about 30 years. It comes from industry analysis rather than an official forecast, and the real figure will depend on house prices, investment returns, care costs and how much older people choose to spend.

Treat the headline as a sense of scale rather than a forecast for your family. Property is the largest single component of household wealth, but at 40% it isn’t the majority, and private pensions follow close behind at 35%. Median household wealth in Great Britain was £293,700 over the same period, according to the ONS, so most families’ own position looks very different from the trillions.

Who actually receives it, and when?

A minority of people, and often later than they hoped. Resolution Foundation research published in 2022, based on a YouGov survey of 8,749 adults, found that 32% had received or expected to receive an inheritance or gift in their lifetime. Among its other findings:

• The richest fifth of earners were twice as likely as the poorest fifth to expect a significant transfer (50% against 25%).
• The typical projected age at which 20- to 35-year-olds receive an inheritance is 61, so money often arrives in later life rather than during the years of buying a first home or raising children.
• A third of gifts (33%) were given to help with a property purchase.
• Many older givers changed their own behaviour: 16% saved more and 9% had downsized or expected to.
• Among over-65s who intended to give but weren’t sure how much, 45% said social care costs were a concern.

That last finding sits at the heart of good planning. Before anyone thinks about how much to pass on, it helps to know what their own later life needs. Finura’s articles on whether to gift wealth while living or leave it in your will and how to help with a first home deposit in a tax-smart way explore that balance.

What do the latest HMRC figures say about Inheritance Tax?

Inheritance Tax is paid by fewer than one in 20 estates, but the amount collected keeps rising. HMRC published its latest liabilities statistics on 30 July 2026, covering deaths in the 2023/24 tax year.

The first five rows come from HMRC’s Inheritance Tax liabilities statistics and the last from HMRC’s annual tax receipts bulletin. Liabilities and receipts differ because tax is usually due at least six months after a death, so the two don’t line up year by year.

The average effective rate sits well below 40% because of the spouse and civil partner exemption, reliefs and allowances. HMRC links the rise in liabilities to higher volumes of wealth transfers, rising asset values and the decision to keep the tax-free thresholds at their 2020/21 levels.

Two points are easy to miss. The tax is paid by the estate rather than by the people who inherit, and GOV.UK says beneficiaries do not normally pay Inheritance Tax on what they receive. And the oldest estates carry most of the bill: in 2023/24, estates of people aged 85 and over accounted for 56% of liabilities, and those aged 75 to 84 for a further 27%.

How much can you leave without paying Inheritance Tax?

The tax-free threshold is £325,000 per person. GOV.UK explains that it can rise to £500,000 if you leave your home to your children or grandchildren, and unused allowances can pass to a surviving spouse or civil partner. HMRC notes that this means some estates can pass on up to £1 million before tax becomes due.

There are limits. The extra home allowance (the residence nil-rate band, currently £175,000 per person) starts to taper away once an estate exceeds £2 million, and the government has announced that all of these thresholds stay frozen until 5 April 2031 in its Inheritance Tax thresholds policy paper.

Finura’s guide to the residence nil-rate band walks through how the home allowance works in practice.

What’s already changing, and what’s still speculation?

Some changes have been announced with dates. Others remain rumour until the Chancellor speaks.

Press speculation about further reform isn’t policy until it’s announced, and as at 7 October 2026 we aren’t aware of any further confirmed changes. You don’t need to act on rumours. A plan built around what you want your money to achieve tends to hold up better than one built around headlines, which is the theme of Finura’s guide to making good financial decisions, even under pressure.

Finura’s article on what’s changed since Andy Burnham became Prime Minister separates the confirmed measures from the government’s direction of travel. It also notes that areas such as wealth, pensions and inheritance could still see changes, none of which should be treated as a prediction.

How can you prepare, whether you’re giving or receiving?

A useful place to start is with the questions that sit behind the tax. What will you need yourself? What do you want the money to do for the people you love? Who needs to know?

If you expect to give

• Start with your own security. Work out what you’ll need for later life, including the possibility of care costs, before deciding how much you can comfortably give away and never need back.
• Know the gifting basics. GOV.UK sets out that you can give £3,000 a year under the annual exemption (carrying forward one year’s unused amount), make regular gifts from surplus income and give wedding gifts. Larger gifts generally fall outside your estate if you survive seven years. Taper relief reduces the tax on gifts made three to seven years before death, but only where gifts in the previous seven years total more than the £325,000 threshold.
• Review your pensions. If you have pension funds you don’t expect to spend, it may be worth looking at how they fit into your plan before April 2027. Finura’s retirement planning team can help you weigh up the options.
• Talk early. Finura’s article on the psychology of inheritance explains why these conversations can feel so hard, and why having them still pays off.
• Keep your paperwork current. A current will sets out what happens after you die, and a lasting power of attorney lets someone you trust make decisions about your money and property if you ever can’t.

If you expect to receive

• Give yourself time. Unbiased suggests holding inherited money in a secure, accessible account while you take stock, rather than making large decisions straight away.
• Understand the tax side. The estate pays any Inheritance Tax before assets pass on. You may owe Capital Gains Tax if you later sell an inherited asset at a profit, and Income Tax can apply to some inherited pension income, as HMRC explains.
• Think through the practicalities of property. An inherited home brings insurance, maintenance and decisions about whether to sell, rent or live in it.
• Talk to your family. Agreeing expectations early can prevent misunderstandings later.

A family story: Sue, Mark and the unspent pension

Sue’s story is an illustrative example rather than a real client, and the figures are simplified.

Sue is 74. Her husband died three years ago and left everything to her, so she holds both his tax-free allowances and her own. She owns a house worth £650,000, has £150,000 in savings and ISAs, and has a pension pot of £300,000 that she has barely touched because she’s been living on her savings. Her son Mark is 47, has two children and rents. Her daughter Anna lives abroad.

Sue’s biggest concerns are personal. She’d like to help Mark with a deposit but isn’t sure she can afford it, given the cost of care she might need one day. She doesn’t want Anna to feel overlooked. And she has never talked about any of it with either of them.

Under today’s rules, Sue’s estate is worth £800,000, because her pension sits outside it. Her combined allowances come to £1 million (two nil-rate bands of £325,000 and two residence nil-rate bands of £175,000, as the house would pass to her children), so no Inheritance Tax would be due. From April 2027, if the pension is unspent when she dies, it’s due to count towards her estate. That takes the total to £1.1 million, which is £100,000 over her allowances and a potential Inheritance Tax bill of £40,000 at 40%. Her children could also pay Income Tax on money they take from an inherited pension, depending on the circumstances.

None of this means Sue needs to rush. It means the order in which she draws on her pension, ISAs and savings is worth reviewing, alongside what she can comfortably give away. Her planner started with a cashflow model of her own later life, including a care-cost scenario, before anyone mentioned tax. Only then did they look at what Sue could give and never need back.

Sue decided to help Mark with his deposit, at a level the model showed she could afford. She agreed to review the plan after the Budget rather than act on rumours. And she told Mark and Anna together what she was doing and why, so neither was left to guess.

What Sue’s example shows:

• Your own cashflow shapes the right answer more than the headline tax rules do
• The 2027 pension change can alter the picture for estates close to the allowances
• A gift sits more easily when it comes from money you’ll never need back
• Telling every child at the same time helps avoid resentment and guesswork

Frequently asked questions

What is the Great Wealth Transfer?

It describes the passing of wealth from older generations, mainly Baby Boomers, to their children and grandchildren through inheritance, gifts and estate planning. Industry estimates put the UK total at £5.5 trillion to £7 trillion over about 30 years, though these are projections rather than official forecasts.

Do you pay tax on an inheritance in the UK?

Not normally. The estate pays any Inheritance Tax before assets are passed on, and GOV.UK says beneficiaries do not normally pay Inheritance Tax on what they receive. You may still owe Capital Gains Tax if you later sell an inherited asset at a profit, and Income Tax can apply to some inherited pension income, as HMRC explains.

How much can you leave tax-free in the UK?

The Inheritance Tax threshold is £325,000 per person, rising to £500,000 if you leave your home to your children or grandchildren. Unused allowances can pass to a surviving spouse or civil partner, so some couples can pass on up to £1 million before tax is due. The thresholds are frozen until 5 April 2031.

Will pensions be subject to Inheritance Tax?

From 6 April 2027, unused pension funds are due to count as part of your estate for Inheritance Tax, according to HMRC. Whether that changes anything for your family depends on the size of your estate and your other allowances, so it’s worth reviewing your plan well before that date.

Will most families pay Inheritance Tax?

No. On HMRC’s latest figures, 4.72% of UK deaths in 2023/24 resulted in an Inheritance Tax charge, so fewer than one in 20 estates paid. That proportion has been rising, though, and HMRC links this to higher asset values and the decision to keep thresholds frozen.

At what age will millennials inherit?

The Resolution Foundation projected in 2022 that the typical age at which 20- to 35-year-olds receive an inheritance is 61. Many families give earlier, often to help with a first home, which is one reason gifting has become part of the conversation.

Is it better to give money away now or leave it in your will?

It depends on your income, future spending, wider estate and what you want the money to achieve. Giving during your lifetime lets you see the difference it makes, while keeping wealth gives you security for as long as you need it. Finura’s article on gifting wealth while living or leaving it in your will explores the trade-offs.

Sources and further reading

Sources checked on 7 October 2026.

• HMRC: Inheritance Tax liabilities statistics: commentary (updated 30 July 2026)
• HMRC: Tax receipts and National Insurance contributions for the UK, annual bulletin (updated 22 September 2026)
• HMRC: Tax Confident, receiving an inheritance
• GOV.UK: How Inheritance Tax works: thresholds, rules and allowances
• GOV.UK: Inheritance Tax and gifts
• GOV.UK: Inheritance Tax: thresholds policy paper (published 26 November 2025)
• GOV.UK: Make, register or end a lasting power of attorney
• HM Treasury: Chancellor letter to the Treasury Select Committee, Budget 2026 date (31 July 2026)
• Office for National Statistics: Household total wealth in Great Britain: April 2020 to March 2022
• Resolution Foundation: Fewer than one-in-three people expect to benefit from Britain’s big inheritance windfall (3 February 2022)
• Unbiased: What is the great wealth transfer? (last updated 22 December 2025)

More from Finura

• The psychology of inheritance: why money conversations fail inside families
• Should you gift wealth while living or leave it in your will?
• How to help with a first home deposit in a tax-smart way
• The Residence Nil Rate Band (RNRB): what it means for inheritance tax planning
• Trusts explained simply: when they help, when they don’t
• How to make good financial decisions, even under pressure
• What’s changed since Andy Burnham became Prime Minister?

Articles on this website are offered only for general information and educational purposes. They are not offered as, and do not constitute, financial advice. You should not act or rely on any information contained in this website without first seeking advice from a professional.

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Date written: 8th October 2026

Approved by Evolution Wealth Network Ltd on 27^th October 2026.