Would your children rather inherit £100,000 when they’re 60 — or receive £25,000 when they’re 30 and desperately trying to buy a home?

For many people in their 50s and early 60s, inheritance planning starts as a fairly simple thought:

“Whatever’s left goes to the kids.”

But once your home, pension, savings and investments are added together, “whatever’s left” could easily be several hundred thousand pounds.

That creates a more interesting question.

Should you preserve as much as possible for your family after you die?

Or should you start helping them now — while you’re still around to see what the money actually does?

First, work out what you’re really worth

Most people don’t regularly calculate their estate.

Try it.

Add together:

Your home equity
Savings and ISAs
Investments
Other property
Valuable assets
Life insurance payable to your estate
And, increasingly, pensions

Then subtract debts.

You may be surprised by the number.

Someone with a £550,000 mortgage-free home, £250,000 pension and £100,000 of other investments is already looking at assets approaching £900,000.

And there’s an important change coming.

From 6 April 2027, most unused pension funds and pension death benefits will be brought within a person’s estate for Inheritance Tax purposes.

That makes understanding your total estate increasingly important.

Could inheritance tax affect you?

The basic UK Inheritance Tax threshold is currently £325,000.

If you leave a qualifying home to children or grandchildren, an additional residence allowance can potentially increase your threshold to £500,000.

For married couples and civil partners, unused allowances can potentially transfer to the surviving partner, meaning a qualifying estate may ultimately pass on up to £1 million before Inheritance Tax becomes payable.

Above the available allowances, the standard Inheritance Tax rate is generally 40%.

The exact position depends heavily on your circumstances, so this is one area where proper tax or estate-planning advice can be worthwhile.

What about giving money away now?

This is where inheritance planning becomes less about tax and more about timing.

Perhaps your daughter needs £30,000 towards a house deposit.

Perhaps your son is paying eye-watering childcare costs.

Giving them money at 32 could fundamentally change their finances.

Receiving the same money at 62 may simply make an already comfortable retirement slightly more comfortable.

UK inheritance rules also allow some lifetime gifting.

You can currently give away £3,000 each tax year using the annual exemption, with other exemptions potentially available depending on the circumstances.

Larger gifts can also fall outside your estate for Inheritance Tax if you survive for seven years after making them, although the rules become more complicated if you die within that period.

But don’t let tax become the only reason you give money away.

Don’t make yourself poor to make your children richer

This is the danger.

At 55, you might look at £700,000 of assets and feel wealthy.

But that money may eventually need to fund another 30 or 40 years of your life.

Retirement income, holidays, maintaining your home and helping family are one thing.

Later-life care can be another.

Giving £100,000 away at 58 and discovering at 78 that you desperately need it is very different from leaving £100,000 less in your will.

You cannot know exactly how long you’ll live or what you’ll need.

That’s why a sensible inheritance plan starts with one rule:

Secure your own retirement first.

Then decide what you can genuinely afford to give away.

And yes, you really should have a will

A surprising number of people build substantial assets without clearly deciding what should happen to them.

A will lets you specify who receives your money, property and possessions.

Without one, your estate is distributed according to intestacy rules rather than simply according to what your family assumes you wanted. The exact rules differ across England and Wales, Scotland and Northern Ireland.

A will should also be revisited when circumstances change — marriage, divorce, grandchildren, property purchases or major changes in wealth.

Perhaps the goal isn’t leaving the biggest number

There’s an old-fashioned idea that good financial planning means dying with the largest possible estate.

But another definition might be better:

Use your money well while you’re alive, protect yourself against an uncertain future, help the people you care about when it matters — and pass on what’s left efficiently.

For one family that might mean leaving £1 million.

For another, it might mean giving children £50,000 each in their 30s and leaving considerably less later.

Neither is automatically right.

The interesting question is what your money could achieve now versus later.

Enter your property, pension, savings and investments to estimate the size of your estate — then see what could be left to your family if you give £25,000, £50,000 or £100,000 away today.

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