One in three UK high net worth families have argued over inheritance and half of the country’s wealthy cannot decide how to split their wealth between heirs, new research reveals.
Despite this, more than £1 trillion (€1.2 trillion) is due to pass between generations over the next 20 years.
According to the Coutts report, Breaking the wealth taboo: making succession a success, inheritance planning is becoming increasingly complicated as families become less traditional due to divorce and multiple marriages.
Thirty-seven per cent of families admitted to serious family disputes over the splitting of inherited wealth and assets, and 58% of respondents said they did not have an up-to-date will.
A further fifth of parents said they had not disclosed their true worth to their children for fear of curbing their aspirations, or to protect them from inadvertently revealing information to people who might befriend them due to their wealth.
The revelation of confidential family matters via social media was a particular concern for many families.
Less than a quarter of parents (23%) would consider raising the prospect of a pre-nuptial agreement with their inheritors, despite divorce rates of 42% in the UK.
Executive director at Coutts Juliette Johnson said: “In the UK, 46% of marriages are subsequent marriages and with 2.5 million step-children in the UK, blended families and step-grandchildren are now part and parcel of family life which can add further complication to succession and inheritance planning.”
She said it was a good idea to raise the idea of a pre-nup before inheritors had met their prospective spouses, when the issue is less emotive.
“One simple yet effective strategy of preserving the family wealth is to open up communication in the family and start to think about the various risks that could arise in the future and agree how they should be dealt with,” Johnson said.
The research also found 32% of families do not intend to pass on any wealth to children until the death of both parents, and passing wealth on to the eldest child is still the main succession plan for one in 33 British families.
The report interviewed 270 families with liquid assets worth more than £1 million.