Retirees now giving away £4,500 a year to family amid inheritance tax fears
One in every six pounds spent by UK retirees now goes straight to family, as more people act early to shrink a future inheritance tax bill.
New research suggests UK retirees are handing money to their families faster than ever, as concerns about inheritance tax reshape spending in later life.
Quilter's second annual Retirement Lifestyle Report, based on a survey of just over 5,000 UK retirees, found the average retiree now gives away £2,272 a year to relatives and spends a further £2,250 on education costs for children and grandchildren, a combined £4,522 a year. That means gifts to family now make up roughly one in every six pounds retirees spend, out of average annual spending of £27,159, itself up around £5,000 on the year before.
The trend reflects a wider shift towards giving while living: passing on money early rather than waiting for an estate to be settled, partly to help family now and partly because gifts made more than seven years before death usually fall outside the taxable estate.
It's a reminder that inheritance planning isn't only about wills and pensions. Large lifetime gifts can still be caught by inheritance tax if you don't survive seven years, which is one reason some families look at life insurance, written in trust, to cover that risk without adding to what's taxed.
Based on reporting by Professional Adviser (17 September 2026). Information only, not advice.
Information only. This is general information, not financial, tax or legal advice, and not a personal recommendation. Tax rules depend on your individual circumstances and can change. Please speak to a qualified, FCA-regulated adviser or a solicitor before acting.