Around two-fifths (43 per cent) of people expect to receive an inheritance or lifetime gift of wealth from family and friends at some point, with 32 per cent planning to direct these funds towards their savings or pension, according to research from Fidelity International.

However, despite the number of people relying on inherited wealth to reach their pension and property goals, less than half (45 per cent) have taken some form of financial advice.

In particular, 20 per cent went to another professional for advice, while 16 per cent looked online, 15 per cent spoke with an independent financial adviser, and 14 per cent spoke to their bank.

In light of the findings, Fidelity International has highlighted a number of key considerations when passing on wealth, including the potential of pensions, as these are not included when calculating inheritance tax (IHT).

Considering this, the firm suggested that using other assets to fund retirement means pensions can be passed on tax-free while gradually reducing the size of the taxable estate.

Fidelity International head of advice policy and development, Dawn Mealing, commented: “Buying a home and saving for retirement are considered two of the most significant milestones upon the road to financial security.

“However, our research highlights just how many of the UK’s younger generations are counting upon the passing down of wealth from family and friends to achieve them.

“Families are increasingly looking at how they tackle these goals together, considering how and when this transition of wealth takes place - either as an inheritance, or sooner as a lifetime gift - so it can be used most effectively.

“Financial advice can provide invaluable support for those looking to pass wealth on, as well as to those who receive it. From the perspective of the older generation, seeking advice can help them to navigate the complexities of IHT and mitigate some of the potential losses the 40 per cent rate might pose.

“For those who receive an inheritance, it could well be one of the largest single sums of wealth they ever receive. Financial advice can offer invaluable support and peace of mind when it comes to knowing how best to approach this, particularly when the recipient has specific financial goals in mind."

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