Gen Z Is Banking on Inheritance. Parents Have Other Plans.
Nearly a quarter of Gen Z adults say they aren't bothering to save for retirement.
The reason: they expect an inheritance to cover it. New research suggests that bet may not pay off.
The Numbers Behind a Generational Gap
A survey from retirement specialist Standard Life found that 23% of Gen Z adults — those born between 1997 and 2012 — are not prioritising retirement saving because they expect to receive money or property from family members.
The pattern isn't unique to Gen Z. Among millennials, born between 1981 and 1996, a similar share, 20%, said the same thing.
That's a significant portion of two entire generations effectively building their retirement plan around someone else's estate.
The problem, according to Standard Life's research, is that the parents holding those estates have different plans entirely.
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What Parents Are Actually Planning to Do With Their Money
One in seven parents — 15% — now say they intend to prioritise spending their own retirement savings rather than preserving them to pass on to their children.
The framing many parents used was "living for today," rather than treating their savings as a fund to be protected for inheritance.
That shift isn't happening in isolation. A separate factor is actively pushing parents toward spending rather than saving: incoming changes to how pensions are taxed after death.
From April 2027, most unspent pension funds and pension death benefits will be brought into the value of a person's estate for inheritance tax purposes.
According to the same Standard Life research, nearly three in 10 parents — 29% — said this change will directly affect how they plan to use their pension during retirement.
Of those affected, 10% said they're now more likely to draw down their pension savings during retirement rather than leave them untouched, while 22% said they're now more likely to gift money to their children while they're still alive, rather than leaving it as a formal inheritance.
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Why Standard Life Is Calling This a Risky Bet
Mike Ambery, retirement savings director at Standard Life, was direct about the danger of treating an inheritance as a retirement plan.
He said inheritance can play an important role in family finances, but warned it's risky for younger people to build their retirement plans around money or property they may never actually receive.
Ambery acknowledged why the temptation exists. With living costs and financial pressures weighing on younger generations, it's understandable that some look to a future inheritance as part of their financial picture.
But he was equally clear that an inheritance is far from guaranteed, given that people are living longer and later-life costs are rising — both of which mean parents may genuinely need to spend more of their own savings than their children expect.
His recommended framing: inheritance should be treated as a possible bonus, not a substitute for building an independent retirement pot.
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The Research Backs Up Why Parents Are Reconsidering
A separate piece of research from retirement company Just Group adds useful context to why parents' priorities are shifting.
Among older generations approaching or already in retirement, leaving an inheritance was not ranked as a top retirement goal for most respondents. Spending time with friends and family ranked highest, chosen by nearly half of respondents, followed by travelling abroad and travelling domestically.
Leaving an inheritance was selected as a top-five retirement goal by only one in five respondents in that research — a notably smaller share than the proportion of Gen Z and millennials currently counting on receiving one.
Stephen Lowe, group communications director at Just Group, said the research suggests leaving money behind isn't high on the retirement agenda for most baby boomers, with most prioritising spending time with people they care about or pursuing travel and hobbies instead.
What This Means for Anyone Planning Their Own Retirement
Financial experts who study retirement consistently point to one factor that matters more than almost anything else: starting early.
Pension contributions benefit from decades of compound growth, meaning money contributed in your twenties or thirties has dramatically more time to grow than money contributed later in life.
Workplace pensions offer a specific advantage worth understanding: many employers will match or increase their own contribution when an employee increases theirs, effectively adding free money to a retirement pot beyond what an individual contributes alone.
Pension tax relief adds another layer of benefit. For a basic-rate taxpayer in the UK, every £80 contributed from take-home pay is topped up to £100 inside a pension account, with higher-rate taxpayers able to claim further relief either through a tax return or via payroll arrangements such as salary sacrifice.
None of this guarantees a specific financial outcome for any individual, and decisions about how much to contribute, when to access pension savings, or how to structure retirement income depend on personal circumstances that vary considerably from one person to the next.
What the research does make clear is the size of the gap between what a meaningful share of younger people are expecting and what a meaningful share of parents are actually planning to do with their money — a mismatch that, for many families, hasn't yet been discussed directly at all.
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Tom Bennett covers cryptocurrency, stocks, and macroeconomic trends. With a background in economics, he delivers sharp analysis on the stories moving markets.
