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You can find the current article at its original source at https://www.theguardian.com/money/2017/dec/29/millennials-set-to-reap-huge-rewards-of-inheritance-boom
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| Millennials set to reap huge rewards of inheritance boom | Millennials set to reap huge rewards of inheritance boom |
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| An unprecedented inheritance boom is heading the way of today’s younger generation. But it will result in higher wealth inequality and will arrive too late for most people currently excluded from the property ladder, according to a leading thinktank. | An unprecedented inheritance boom is heading the way of today’s younger generation. But it will result in higher wealth inequality and will arrive too late for most people currently excluded from the property ladder, according to a leading thinktank. |
| The Resolution Foundation said inheritances would more than double over the next two decades. It expects the peak year to be 2035, as the baby boomer generation – who have benefited most from the huge increase in house prices – progress through old age. | The Resolution Foundation said inheritances would more than double over the next two decades. It expects the peak year to be 2035, as the baby boomer generation – who have benefited most from the huge increase in house prices – progress through old age. |
| “The large sums of wealth accumulated by older generations will provide a major boost to younger generations’ wealth accumulation and living standards in years to come,” said the foundation. | “The large sums of wealth accumulated by older generations will provide a major boost to younger generations’ wealth accumulation and living standards in years to come,” said the foundation. |
| But the heirs to the property boom will not be struggling first-time buyers. The Resolution Foundation said the average age that someone will inherit would be 61 years old. | But the heirs to the property boom will not be struggling first-time buyers. The Resolution Foundation said the average age that someone will inherit would be 61 years old. |
| About £6tn is currently locked up in the value of Britain’s homes, according to the Halifax building society. But the thinktank said wealth inequality would increase as it was passed on to children. | About £6tn is currently locked up in the value of Britain’s homes, according to the Halifax building society. But the thinktank said wealth inequality would increase as it was passed on to children. |
| Millennials who have yet to get on the housing ladder are much less likely to have property passed on to them. Nearly half (46%) of non-homeowning millennials have parents who don’t own either. In contrast, 83% of millennial homeowners have a parent who also owns their own home. | Millennials who have yet to get on the housing ladder are much less likely to have property passed on to them. Nearly half (46%) of non-homeowning millennials have parents who don’t own either. In contrast, 83% of millennial homeowners have a parent who also owns their own home. |
| The foundation said that among young adults there was a strong relationship between their property wealth and that of their parents. Millennials with their own property wealth of £200,000 or more have parental property wealth of £195,000 per sibling, while millennials who do not own their own home have parental property wealth of £85,000 per sibling. | The foundation said that among young adults there was a strong relationship between their property wealth and that of their parents. Millennials with their own property wealth of £200,000 or more have parental property wealth of £195,000 per sibling, while millennials who do not own their own home have parental property wealth of £85,000 per sibling. |
| “The role of inheritance in driving up already large absolute asset gaps between richer and poorer members of younger generations is an issue deserving of much more attention,” said the foundation. | “The role of inheritance in driving up already large absolute asset gaps between richer and poorer members of younger generations is an issue deserving of much more attention,” said the foundation. |
| The Treasury is also likely to benefit as inheritance tax (IHT) receipts rise. The Office for Budget Responsibility predicts IHT will raise £5.3bn in the 2017/18 tax year, which will eventually increase to £6.5bn by 2022/23. | The Treasury is also likely to benefit as inheritance tax (IHT) receipts rise. The Office for Budget Responsibility predicts IHT will raise £5.3bn in the 2017/18 tax year, which will eventually increase to £6.5bn by 2022/23. |
| IHT is charged at 40% on estates above £325,000, but a phased increase in allowances, first announced by George Osborne in the summer 2015 budget, effectively allows parents to leave homes worth up to £850,000 to their children free of tax. This will rise to £1m by 2020. | IHT is charged at 40% on estates above £325,000, but a phased increase in allowances, first announced by George Osborne in the summer 2015 budget, effectively allows parents to leave homes worth up to £850,000 to their children free of tax. This will rise to £1m by 2020. |
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