Tax Planning

Can you enjoy your retirement wealth and still leave an inheritance?

The debate around what point in your life to enjoy your hard-earned savings has sparked plenty of discussion in recent years, helped by the popularity of Bill Perkins’ book Die With Zero. Despite the title, the concept isn't about spending every last penny before you die but rather making the most of your wealth while you can.

After spending your working life, and a considerable amount of time, building up your wealth, it's worth considering whether you could be enjoying more of that wealth now while you still have your health. If you’re also planning on leaving something for your loved ones, it can be difficult to strike the balance and know when it’s the right time to start.

But how do you know when it’s the right time?

When you've spent years saving towards retirement, it's tempting to keep going until you've reached a particular figure. Perhaps you're waiting for your pension to reach a certain value or want to see your investments grow a little further before you feel comfortable drawing on them.

You may have a healthy pension and substantial savings but still feel uneasy about the prospect of spending them. This is completely normal. After all, you're moving away from a regular income and into a period of life where the money you've accumulated will need to last for the rest of your life.

However, some experiences have an expiry date and waiting too long can mean you may miss out. If you've always wanted to travel extensively, you may get considerably more enjoyment from doing so in your early retirement years, while you're fit and healthy. Equally, retiring a few years earlier might allow you to spend more time with your family, and young grandchildren, rather than continuing to work towards a savings target you may already have exceeded.

This is where understanding how much you actually need becomes important. Once you have a clearer picture of what your retirement might cost, you can start making decisions around what you want to do, rather than simply how much you want to accumulate.

Making the most of your money while you can

One of the most interesting concepts from Die With Zero is the idea of a 'memory dividend'. The experiences you enjoy today can continue to bring happiness for years to come through the memories they create. And those memories aren't necessarily just yours; they can be shared with your family and loved ones too.

Whether it's taking your family on a memorable holiday, helping your children onto the property ladder or spending more time with your grandchildren, the benefits of using your wealth can extend well beyond the initial experience.

Of course, perhaps the greatest difficulty with retirement planning is that none of us knows exactly how long our money will need to last or how much we're going to need.

We often find that people have a fairly good idea of what they've saved but are less certain about how much they can comfortably afford to spend.

Without that reassurance, it's understandable that you might hold back, even when you could potentially afford to enjoy more of your wealth or be more generous with those around you.

This is where cash flow planning can be particularly valuable.

How cash flow planning can help

At The Private Office, we use cash flow forecasting to help you understand what your finances could look like throughout retirement, taking into account your current assets, expected income and future spending.

By building a picture of your finances over time, we can explore what might happen as your spending and earning circumstances change.

For example, you might be considering giving your children £100,000 towards a property purchase. Cash flow planning can help illustrate how that decision could affect your retirement finances, including how much you might have left later in life.
We can also consider different investment returns, inflation assumptions and unexpected expenses to see how your plans might hold up if circumstances don't work out quite as expected.

Sometimes the results can be surprising. You may discover that you've been unnecessarily cautious and could afford to spend considerably more. Or the forecasts may show that making a large gift now could leave you with less financial security than you're comfortable with.

These forecasts aren't guarantees, of course, and should be reviewed regularly. But they can provide a much clearer basis for making important financial decisions.
Once you have a clearer understanding of how much you need to fund your own retirement, you can also explore whether any surplus wealth could be passed on to loved ones sooner, rather than waiting until your legacy.

Could a living inheritance make more sense?

For many people, leaving something behind for their family is just as important as enjoying their retirement. yet there's a growing argument for passing on some of that wealth while you're still alive. In fact, we ran a survey recently with over 2,000 respondents and found that 81% believe parents or grandparents should help younger generations financially during their lifetime, rather than simply leaving an inheritance when they die.

Consider how much more useful an inheritance might be to your children when they're buying their first home or raising a young family, rather than receiving it much later in life when they may already be financially secure. Our survey also found that 71% believe financial support should be given early, when it can make the biggest impact.

There's something quite rewarding about seeing your money make a difference. Seeing your contribution to their life with your own eyes means you get to share in the benefits of your generosity, and it can be very fulfilling.

Of course, you might prefer to support a charity or cause that's particularly important to you. Making donations during your lifetime means you can see how your contribution is being used, which may be just as meaningful as leaving a charitable gift in your will.

What about inheritance tax?

Passing on wealth during your lifetime can also help with inheritance tax planning, although there are rules to consider before making substantial gifts.

You can currently give away £3,000 each tax year using your annual gift exemption, with any unused allowance carried forward for one tax year. Larger gifts may also fall outside your estate for inheritance tax purposes if you survive for seven years after making them, known as the 7 year rule in inheritance tax.

If you have surplus income, you may be able to make regular gifts without them forming part of your estate, provided they meet HMRC's conditions.

The wider inheritance tax position is becoming increasingly relevant too. The standard inheritance tax nil rate band, which is the amount you can pass on before inheritance tax becomes payable, remains frozen at £325,000 until April 2031. There is an additional residence nil rate band of up to £175,000 available when you pass your home to direct descendants, subject to certain conditions. With these thresholds remaining frozen while property prices and other asset values increase, more families could find themselves facing an inheritance tax liability.

And from April 2027, most unused defined contribution pension funds and pension death benefits will be included within the value of an estate for inheritance tax purposes. This is a significant change for anyone who has been planning to leave their pension untouched to pass on to the next generation.

However, before giving money away, you need to be comfortable that you won't need it yourself. Once an outright gift has been made, you generally can't simply ask for it back if your circumstances change.

Finding the right balance

There's no particular amount you should aim to leave behind when you die. Some people are perfectly comfortable spending most of their wealth during retirement, while others take great satisfaction in knowing they'll be able to leave a substantial inheritance.
You might also find that your priorities change as you get older, particularly as your family circumstances evolve.
Having a financial plan gives you the opportunity to think about these choices properly, rather than continuing to save out of habit or holding back because you're worried about what the future might bring.

And if you can enjoy the retirement you've worked hard for while also seeing your wealth benefit the people and causes you care about, that seems a pretty good outcome.

This article is intended for general information only, it does not constitute individual advice and should not be used to inform financial decisions.

The Financial Conduct Authority (FCA) does not regulate cashflow and estate planning or tax advice.

UK Inflation hits 3.5% ahead of Budget

UK Inflation (CPI) rose higher than expected in September to 3.5% according to the latest figures released from the Office for National Statistics (ONS).

With just a week until new Chancellor John Healey delivers his first Budget as chancellor, the new inflation figures and the subsequent expectation of a base rate hike are adding pressure. That said, unemployment in August 2026 fell to 4.7% from 4.9% in July, according to the ONS, where 5% was expected, so the overall picture is mixed in the lead up.

Reacting to the figures, Healey claimed "conflicts in the Middle East and Europe" were to blame for rising prices, adding that his Budget next week would give families and businesses "breathing space".

Economists had expected the consumer prices index (CPI) to rise to 3.4%, meaning inflation exceeded expectations by 0.1%. This may not seem like a lot, but it's important to remember that the predicted 3.4% was already a bad sign for consumers, as it is still well above the Bank of England’s 2% target.

For those on the state pension waiting on the final part of the triple lock to see what their pension increase will be, there will be no change, however. With all three elements of the triple lock now received (inflation, wages, or 2.5%), the increase in average wages has proved to be the highest of the trio, rising at 3.9%, so the government is expected to confirm 3.9% as the rise in the state pension in April.

Why is inflation on the rise again?

Figures from the ONS revealed that rising fuel costs were the biggest contributor to September’s increase in inflation. Petrol prices climbed by an average of 8.2p per litre between August and September 2026, compared with a 0.2p decline over the same period last year.

Diesel prices also increased sharply, rising by 10.7p per litre in September 2026, against a fall of 0.4p in September 2025. The increases follow a surge in global oil and gas prices since the US and Israel launched their war Iran at the end of February, disrupting energy supplies passing through the Strait of Hormuz.

Higher fuel costs also affected air travel, with fares falling by less than is typical in September following the busy summer holiday period.

However, there was some welcome news for the chancellor, as clothing prices edged down and food price inflation held steady at 1.3%. Strong competition between supermarkets helped limit the impact of rising transport costs on food prices.

What is inflation and how is it measured?

Inflation is a measure of how the prices of goods and services have increased over time. Goods are tangible items sold to customers, such as food, while services are tasks performed for the benefit of recipients, such as a haircut. Generally, this increase is measured by considering the cost of things today compared to how much they cost a year ago. The average increase between these prices is demonstrated in the inflation rate.

Rising interest rates directly affects the cost of living. For example, if the price of a bottle of milk is £1, and inflation is increasing by 5%, then your bottle of milk will cost you 5p more. Or, in other words, the spending power of your money has decreased by 5%.

Ideally, the Government wants to keep inflation low and stable. The general mandated target for the Bank of England is 2%.

Anything significantly above or below this target is thought to cause issues for the economy and may result in pressure to increase UK base rates which would increase the costs of borrowing.

Our chartered financial advisers are expert and unbiased, meaning that they can give whole of market advice, and so are best placed to give you a plan tailored exactly to your personal financial goals.

If you’d like to know more, request a free non-committal initial consultation with one of our team or give us a call on 0333 323 9065 and get in touch.

The Financial Conduct Authority (FCA) does not regulate cash flow planning, estate planning or tax advice.

The number of workers facing 60% tax trap doubles

The number of workers caught in the 60% income tax trap has more than doubled over the past five years, rising from 376,000 in 2020-21 to an estimated 763,000 in 2025-26.

Figures obtained from HMRC through a freedom of information (FOI) request show that an additional 78,000 taxpayers have been pulled into the bracket since 2024-25, largely as a result of frozen tax thresholds.

The tax trap affects those earning between £100,000 and £125,140, who face an effective income tax rate of 60%, among the highest in the UK.

This is due to the gradual withdrawal of the £12,570 tax-free personal allowance, which is reduced by £1 for every £2 earned above £100,000.

Consequently, taxpayers lose £60 in income tax for every additional £100 earned within this range. Once earnings reach £125,140, the personal allowance disappears entirely and income above this level becomes subject to the 45% additional rate of tax.

There have been growing calls for the Government to scrap the 60% tax trap over concerns that it discourages higher earners from taking on promotions or working additional hours. With the estimated number of workers being pulled into the trap increasing in forecasts, the pressure on the Government to address the issue is continuing to rise.

Number of UK workers hit by the 60% tax trap doubles in five years, October 2026 (Source: The Telegraph)

What is the ‘60% tax trap’?

The ‘60% tax trap’ refers to the income band of £100,000 to £125,000 between which earners in England and Wales will effectively experience a 60% tax rate on their marginal income. This is because for every £2 you earn over £100,000 each year, you lose £1 worth of your £12,570 tax-free personal allowance. Your tax rate only returns to the normal amount of 40% after the entirety of your personal allowance for that year has been deducted, which is at just over £125,000.

For example, a £100,000 earner who receives a bonus of £1000 will only receive £400 of his bonus. This works out as follows:

He immediately loses £400 to the standard 40% tax, leaving him £600.

As he loses £1 for every £2 earned over £100,000, his £1000 bonus translates to £500 deducted from his original tax-free personal allowance. This deduction of £500 is then retrospectively taxed at his current standard rate of 40%, meaning he pays another £200.

After paying the original tax of £400 and then the subsequent tax of £200, he is left with only £400 of his original £1000 bonus, meaning he has effectively experienced a 60% tax rate.

If you want to find out more, why not give us a call on 0333 323 9065 or book a free non-committal initial consultation with one of our chartered advisers to find out how can help.

The Financial Conduct Authority (FCA) does not regulate cash flow planning, estate planning or tax advice.

Editors

£217m left forgotten in cash ISAs

More than £217m is currently held in dormant National Savings and Investments (NS&I) cash ISA accounts, according to figures released following a freedom of information request by the Telegraph.

Over the past four years, the number of forgotten accounts has risen almost five-fold, with an average of £5,061 held in each inactive account.

Between 2020-21 and 2024-25, the number of dormant cash ISAs accounts climbed from 8,621 to 42,973, while the total amount held in them increased from £36.7m to £217.5m.

The Treasury-backed savings provider introduced its direct ISA accounts in 2006 and classifies them as ‘dormant’ when no transactions have taken place for 15 years. Under NS&I's procedures, account statements are no longer issued when correspondence is repeatedly returned undelivered or when these 15 years have passed without customer contact.

Although dormant accounts continue to earn interest at their usual rate, there is a risk that the money could eventually be transferred to NS&I's residual account. This holds balances from products that have matured or been withdrawn and typically pays a much lower interest rate of around 0.25%.

The figures also revealed that £614m was sitting in 1,117,000 postal-only savings accounts, which can only be managed through physical mail.

Savers with these investment accounts have missed out on average around £550 of potential interest.

The findings follow an admission by the state-owned savings provider in March 2026 that it had misplaced nearly £500m of customers' savings, potentially including cash ISAs. The issue came to light following an investigation by The Telegraph into delays in releasing funds to bereaved families.

The controversy ultimately resulted in the departure of Dax Harkins, who resigned after three years as NS&I's Chief Executive.

What is an ISA?

An ISA, or ‘Individual Savings Account’, is a scheme that allows anybody to hold cash, shares and unit trusts free of tax on dividends, interest and capital gains. Essentially, it’s a savings account that you don’t pay tax on.

A cash ISA is a tax-free savings account that allows people to save cash without incurring income tax on interest.

You can save up to £20,000 each tax year across ISAs and receive tax-free interest payments, so when the value of your cash ISA increases, you get to keep all of it tax-free. Though it's important to note that from 6 April 2027, the annual cash ISA allowance will fall to £12,000 for those under 65, while those aged 65 and over will continue to be able to save up to £20,000 each year.

While there is a £20,000 allowance in place for how much you can put in a year, there is not a cap on how much you can accumulate in an ISA over a lifetime.

If you want to find out more, why not give us a call on 0333 323 9065 or book a free non-committal initial consultation with one of our chartered advisers to see how we can help.

The Financial Conduct Authority (FCA) does not regulate cash flow planning, estate planning, tax or trust advice.

Budget rumours? Don't panic.

It is not long until Chancellor John Healey’s first budget on 28 October 2026 and you may be wondering if you need to take any action ahead of this.

Newspaper speculation ahead of previous budgets has been rife, with rumours that tax free cash entitlements will be reduced seeming to surface around this time every year. Some pension holders seem to have been taken in by this speculation in previous years; a recent Sky News article revealed £91.2bn was withdrawn from pensions accessed for the first time in 2025/26, up from £53.6bn in 2023/24. However, some people may be regretting their decision to take money out of their pension, given they may have moved funds from a tax free environment within their pension into a taxable environment outside it.

Pensions minister Torsten Bell clearly finds the speculation unhelpful, describing misleading stories as ‘disgraceful’ and ‘garbage’ in a recent Citywire article.

Even if there are no changes to tax free cash entitlements announced in the budget, we are getting closer to the implementation date for a big pension change that has already been announced; that defined contribution pensions will form part of estates for inheritance tax (IHT) purposes from April 2027. Pensions should be reviewed ahead of this, specifically:

The nomination of beneficiaries for pensions - if a married couple are planning to leave their pension to their children rather than each other, this could become tax inefficient in April 2027.
The interaction between pension nominations and wills - especially when these are not being left to the same beneficiary. As inheritance tax will be proportioned between the pension and the estate, the net amounts each beneficiary receives may change overnight on 5 April 2027.
Gifting to charities – again the best way to do this may change. Estates benefit from a reduced inheritance tax rate of 36% when over 10% of the taxable net estate is left to charity, but pension death benefits from April may be subject to IHT and income tax, so it could be the case that leaving part of the pension to charity rather than part of the rest of the estate may become the better option.

However, those aged under 75 who are married or in civil partnership should not panic, as upon their death they can leave their pension to their spouse/civil partner under the spousal exemption and their spouse/civil partner can in turn draw from the pension tax free. Longer term however, consideration could be given if appropriate, to drawing from the pension to create excess income that can be gifted away under the regular gifts out of surplus income IHT exemption as the individual approaches age 75, at which point the tax rules change.

In terms of changes that could be announced:

Prime Minister Andy Burnham has signposted a new ‘Your First Home’ scheme to help first time buyers get on the housing ladder.
There are rumours that capital gains tax (CGT) could be increased. The level and timing of the increase would be important if this does happen, as there are question marks over the increased revenue that is actually raised by increasing CGT, given individuals can choose to hold onto assets and not sell them if increases to CGT rates are significant. However, if a change is announced to take effect in April 2027, this gives individuals the chance to sell assets before the higher rate kicks in which could lead to an increase in activity.
As has been the case in previous years, the chancellor has the option to freeze tax bandings further into the future.

To summarise, Torsten Bell’s comments indicate he is hoping not to see the same level of pre-budget speculation as previous years and investors have often seen sub-optimal outcomes after making decisions based on speculation alone. Therefore, we will need to wait until after the budget to decide if any action is required as a result of any newly announced changes, alongside already known:

Fiscal drag caused by frozen tax thresholds until 2031
Upcoming increases to property income and savings tax rates in April 2027
Cash ISA changes which will limit contributions from next year and mean that individuals looking to transfer their Stocks and Shares ISA into Cash ISAs must do so by April 2027
Mansion tax due to take effect in April 2028
Salary sacrifice National Insurance saving contribution limit of £2,000 to take effect from April 2029

If you would like to discuss the implications of the upcoming changes, please contact get in touch to see how we can help.

This article is intended for general information only, it does not constitute individual advice and should not be used to inform financial decisions.

The Financial Conduct Authority (FCA) does not regulate estate planning, wills or tax advice.

A pension is a long-term investment not normally accessible until age 55 (57 from April 2028 unless the plan has a protected pension age). The value of your investments (and any income from them) can go down as well as up which would have an impact on the level of pension benefits available. Your pension income could also be affected by the interest rates at the time you take your benefits.

UK State Pensions triple lock to be scrapped

Following the Labour Conference in Liverpool, the state pensions triple lock will be scrapped in place of a double lock, according to prime minister Andy Burnham.

Burnham explained that from April 2030, the state pension would continue to rise each year by 2.5% or inflation, whichever is highest, but would no longer be matching earnings – the original third guarantee of the triple lock.

‘It will hold its value relative to earnings over time so that pensioners will always share in the rising prosperity of the nation. This change will generate significant savings, which we will use to build up our own National Care Service,’ Burnham told the Conference.

Burnham went on to compare the policy as one that was as significant as the ‘creation of the NHS itself’.

The triple lock is considered a gold standard for pensioners in the UK, which represent a large voter base, and as such governments have been reluctant to touch it despite a heated debate continuing around its fairness after so many years since its introduction by the Conservative-Liberal Democrat coalition government back in 2011.

Regardless of which side of the debate people fall on, it is clear that the scrapping of the triple lock represents a bold move by Burnham’s government.

"Retaining the inflation link will be comforting to current and future pensioners and if giving up the earnings link provides savings which can be directed towards the chronically underfunded care system then this will be welcomed by many. However, the devil is always in the detail and we eagerly await the promised detail in the next Parliament." – Jane Reade, Head of Financial Planning at The Private Office (TPO).

The 'Triple Lock' explained

The ‘triple lock’ refers to a well-known state pensions policy that ensures state pensions rise every year by either the average earnings growth, inflation (as measured by the Consumer Prices Index) or a flat 2.5% - whichever is highest that year, hence the name ‘triple’ lock.

It was designed in principle to make sure that state pension value would always have the best growth outcome each year for pensioners. The guarantee that the highest of the three will be what pensions grow against ensures that savers have three layers of protection against inflation. This is incredibly important in maintaining a level of healthy financial security for those relying on their pensions, as it guarantees growth irrespective of how volatile the economy becomes.

If you want to find out more about retirement planning, why not give us a call on 0333 323 9065 or book a free non-committal initial consultation with one of our chartered advisers to find out how we might be able to help you.

This article is intended for general information only, it does not constitute individual advice and should not be used to inform financial decisions.

Editors

Back to the future for pensions

After 40 years in the industry, I will be hanging up my boots at the end of the year and taking up a new career on the golf course.

To say that I’ve seen a few changes in that time is an understatement but now, at the end of my career, I’ll take one last spin in the DeLorean and look at the twists and turns that pensions legislation has taken over the last four decades and how that has affected my clients.

The first thing I’d like to say is to offer my sympathies to the general public who have been subjected to rules and complexities which should really be the preserve of rocket science. The opaqueness of pensions has been a disservice to the consumer and for many, this lack of clarity has resulted in rejection. I really don’t blame anyone for this. I have a similar reaction if, for instance, I’m trying to work out which mobile phone package is best. In the end, there is a tendency to turn your back on the whole subject for fear of doing the wrong thing.

But let me make one thing clear. Pensions are, and always have been, the most tax efficient means of saving for retirement.

Stepping back to 1987

If I set my clock to 1987 and step out of my time machine, apart from the padded shoulders, I’m struck by the fact that full tax relief is available on contributions (up to a limit). This is still the case now and if I can say what the most common question clients ask just before a budget it’s “Do you think they will take away higher rate tax relief on pensions?”. Here I am, nearly 40 years later and this highly attractive property of pensions remains intact, yet I expect one last wave of this question before this, my final budget as an adviser.

Tax relief was even more attractive back then because income tax was higher. Who would turn their nose up at the opportunity to invest £40 and for it to be immediately worth £100 (the higher rate of income tax was 60% in 1987)? Many did though. Maybe they thought it was too good to be true. But it was!

In those days, personal pensions were mostly found amongst the self-employed as employed people often enjoyed final salary pension schemes. Over the years, final salary schemes have been culled from the private sector (they’re simply too expensive for employers to run). Now, unless you’re in the public sector, final salary pension schemes are like hens’ teeth.

What happened to pensions from 1995

Let’s get back in the DeLorean and get out in 1995. Until then personal pensions were restricted in that you had to buy an annuity when you retired. This was all very well and meant people didn’t have to worry about investment returns. Annuity rates were also high (although this really only reflected the fact that we had double digit inflation). By 1995, however, rates were reducing and there was growing unrest driven by the prospect of parting with your pension pot in exchange for a low annuity return. So, under John Major’s government, income drawdown was introduced and for the first time pension holders were allowed to keep their funds invested and take an income (within upper and lower limits). As gilt rates (and annuity rates) continued to tumble, we never looked back and drawdown was here to stay (albeit with some horror stories around high-risk portfolios suffering in subsequent market crashes).

Things bumbled along fairly uneventfully for the next twenty years but, in all this time, pensions were never attractive from an estate planning point of view, and nobody ever thought of them in this way. There were all sorts of complex rules which I have no intention of repeating here but, in essence, if pensions were left to anyone other than a spouse there was punitive tax. It was only when George Osborne announced pensions freedom in 2015 that the idea of pensions ‘cascading’ down the generations was invented. Before George, pension funds attracted a fairly hefty tax on death of 55%. Earlier than that and it could have been more, up to 82% in some circumstances. All of a sudden, there was no tax at all and pension funds, particularly for the very wealthy, were now parked for future generations. Furthermore, you could take the whole fund as drawdown. There was a lot of talk about Lambourghinis but, in truth, no one really wanted to draw out so much that they were subject to higher rate income tax.

Then came the Budget in 2024

Which brings us to the present and in 2024 Rachel Reeves announced that pensions would be subject to Inheritance Tax from 2027. Let’s put this into perspective and compare the taxation of a personal pension from 2014 to a pension in 2027. Let’s say leave it to your children as pensions passing to spouses is exempt from IHT. In 2014 it would have been subject to a 55% tax (if in drawdown) so they would end up with 45% of the fund. In 2027 there will be IHT, say 40% if the rest of the estate is substantial enough to use up the Nil Rate Band. This means that 60% is inherited but this, in turn, could be subject to income tax if they die after the age of 75. Let’s say the children are basic rate taxpayers. This means they will inherit, after tax, 48% of the fund compared to 45% in 2014.

There are, of course, situations where it is more punitive now (particularly if the children are higher rate) but the point is that in 2027 most people will be in a similar situation to tax legislation of 2014.

Will the government take away tax-free cash on pensions?

I think the second most common question I’ve had over the forty years is “Will they take away the tax free cash?”. True, it has been capped to the distinctly catchy number of £268,275 but, for most, it still stands at 25% of the fund. Will it be reduced further? Alas, I cannot go into the future, only the past. If I could have, I wouldn’t be here, would I? So, your guess is as good as mine.

In the final analysis, I would say that pensions are more attractive now than they were forty years ago. They are more flexible. Pensions are still inheritable, albeit distinctly less attractive from 2027. They are also cheaper to run. In the 80s most pensions were only available from insurance companies and charges were punitive. These days, plans are cleaner and don’t have initial charges. There is also much more choice of investment, not just a few vanilla funds. Drawdown is definitely a huge advantage, removing the compulsion to buy annuities. I should mention that you still can buy annuities and people still do, in certain circumstances. You could even have both annuity and drawdown.

But with more flexibility comes more responsibility. Good advice is absolutely essential, particularly when in drawdown. The greatest danger to any fund, from which meaningful withdrawals are being made, is something called Sequence Risk. This is the damaging effect on a portfolio if it is all invested in risk funds, and withdrawals are taken at the bottom of the market. A good adviser will recommend holding different risks for different timescales to negate this risk.

So, it’s time for me to forget about the past and buckle into the DeLorean to see what the future holds. I will now become a client of TPO and will see where the road takes us although, as Emmet Brown said “Where we’re going Marty, we don’t need roads”.

This article is intended for general information only, it does not constitute individual advice and should not be used to inform financial decisions.

The information contained in this article is based on our understanding of legislation, whether proposed or in force, and market practice at the time of writing. Levels, bases and reliefs from taxation may be subject to change.

The Financial Conduct Authority (FCA) does not regulate cash flow planning, estate planning, tax or trust advice.

Editors

Are you prepared to die?

Passing away without adequate preparation carries a heavy price tag. Beyond the obvious costs of a memorial service or burial, families face substantial hidden financial and emotional burdens when they overlook proper estate planning. Key oversights such as omitting a valid Will, failing to register a Lasting Power of Attorney, leaving cohabiting partners without legal protection, or leaving financial gifts incomplete can inevitably increase the strain on grieving loved ones.

Research we recently conducted, alongside government and industry data, shows just how widespread this unpreparedness is in the UK – and how much it can cost, in time, money and stress, when families are left to work it out on their own.

How prepared are we, really?

On paper, most people know they should plan ahead. In practice, most haven't. A study by the Money and Pensions Service revealed that 56% of adults in the UK lack a will, with 53% of individuals aged 50–64 falling into this category – an age group where concerns about death and incapacity shift from distant thoughts to a closer possibility. This is also the period of time often referred to as “Sniper's Alley”, when people face a sharply increasing risk of serious health conditions. Without a will, the law decides who inherits, not the person who died – and the rules rarely match what people actually intended.

The preparedness gap extends to digital assets too. A survey by consumer group Which? found that 76% of people have left no plan for what happens to their digital assets when they die. This is especially concerning when finances are involved, with research from Finder, a financial comparison and consumer education platform, estimating that 50.1 million people in the UK now use some form of online or remote banking; that's 91% of the adult population. With many having a digital footprint spanning multiple logins, accounts and portals, often with no record of them held anywhere accessible, for families trying to settle an estate, tracking down that information can add weeks of stress on top of grief.

The gap is even wider when it comes to understanding legal protection within relationships. A Ministry of Justice consultation found that 47% of people in England and Wales believe "common law marriage" exists and gives legal protection after a set number of years together. It doesn’t and never has. With 3.5 million people now cohabiting outside marriage or a civil partnership, and fewer than half of UK adults married or in a civil partnership, that misconception leaves millions exposed. Under current intestacy rules, an unmarried partner has no automatic right to inherit anything from their partner's estate, regardless of how long they lived together or how finances were shared - a protection that at least the children can receive.

Without a will, even a decades-long partnership offers no legal protection. It is one of the starkest examples of what being unprepared can cost the people you leave behind. Even if a will does leave everything to an unmarried partner, there is no Inheritance Tax (IHT) spousal exemption, so IHT would need to be paid, unlike when assets are left to a spouse or civil partner, when there is no IHT payable.

The Private Office's (TPO) own survey of 2,126 UK adults*, mostly aged 45 and over, found that gifting early is desirable. The overwhelming majority, 80.7%, believe wealth should be passed on to the next generation during their lifetime rather than left to inheritance – 67.9% see helping with a first home as the moment support matters most.

Yet many hold back. Retirement security and long-term care costs together account for over half of the concerns people give when asked what stops them from gifting more or gifting at all, demonstrating that financial uncertainty in later life remains the biggest barrier to gifting. It is a solvable problem, however; those who plan early and build a clear picture of their future financial needs are far better placed to gift with confidence, knowing what they can afford to give without compromising their own security and hopefully leaving less tax for their loved ones to pay on their death.

Top barriers to early gifting	%
Running out of money later in retirement	37.3%
Care home costs	15.5%
No concerns	15.0%
Money won’t be used responsibly	11.5%
Inheritance tax concerns	10.7%
Economic uncertainty	4.7%
Family disputes	2.3%

What being unprepared actually costs

Delay becomes deputyship. Without a registered Lasting Power of Attorney, a family that needs to manage a loved one's finances or care decisions after they lose mental capacity has to apply to the Court of Protection instead. Registering an LPA in good time costs £92; applying for deputyship after capacity is lost costs £400 – before factoring in the months it can take to get a court order in place, during which bills, care fees and property costs still need to be paid. Over a million LPAs were registered with the Office of the Public Guardian in 2023–24, a rise of more than 30% since 2019–20, showing more people are waking up to this – but the majority still haven't.

No will means no control, and often, no speed

When someone dies without a valid will, their estate is distributed under intestacy rules, which take no account of unmarried partners, stepchildren, or personal wishes. It also tends to take longer: according to DNA Legal, the number of probate cases taking over a year to resolve has risen 518% in five years, from 377 in 2019 to 2,328 in 2024, as estates become more complex and more contested.

Being unmarried carries a real financial cost

This is an increasingly significant issue given the growth in cohabiting families, which now number around 3.5 million in 2025, more than double the figure 30 years ago. For cohabiting couples, the absence of a will could mean losing a home they've lived in for decades if it isn't owned on a joint tenancy basis. A recent government consultation, which closed on 14 August 2026, examined whether unmarried partners should gain automatic inheritance rights if their partner dies without a will – a sign of how significant a gap this has become, but a change that, if it happens at all, is still some way off. For now, the only real protection is a will, and ideally a cohabitation agreement, drawn up in advance.

Gifting that stalls costs the giver peace of mind and the recipient certainty

TPO’s survey found that among people who haven't yet gifted, 39.7% still intend to – but uncertainty about their own future costs, particularly care, is often what stops a gift from being made or completed, while it would still help most. A gift promised but never followed through leaves both generations in limbo: the older generation still carrying the asset (and the tax exposure) they meant to pass on, and the younger generation still without the support they thought they could expect.

Practical steps: what "prepared" actually looks like

None of this requires anything dramatic – just a small number of documents and decisions, made once and reviewed regularly.

Make a will and review it after any major life event – moving house, starting a new relationship, the arrival of a child, or the death of someone close. This is the biggest single gap in UK planning and the easiest to plug. Free Wills Month is a UK campaign run twice a year, in March and October, giving people aged 55+ the chance to have a simple will written or updated by a solicitor free of charge.
Register a Lasting Power of Attorney for both property and financial affairs and health and welfare while you have full capacity to do so. It's a fraction of the cost and the stress of a deputyship application made in a crisis.
If you're cohabiting, don't rely on "common law marriage." A will that names your partner, and a cohabitation agreement setting out how shared assets are treated, are currently the only reliable protections.
If you're planning to gift, plan the whole gift, not just the giving. Whether it's help with a deposit, a contribution to a pension, or money into a Junior ISA or trust for a grandchild, working out what you can afford to give, and keeping that separate from what you might need for your own care, turns a gift into a plan rather than a decision made under pressure. Don’t forget that if you can make use of the 7 year rule and/or gift money out of surplus income, this can reduce the IHT liability to your loved ones.
Create a digital death file. A will and an LPA tell people what to do, but they still need to be able to find the accounts, documents and contacts to act on those wishes. A secure digital file, one that stores your will, any trust details, tax information, professional contacts and emergency details, and that trusted people know how to access, removes a significant burden from the people left behind. You can also name a digital executor in your will to give someone specific responsibility for managing online accounts and digital assets. Without one, families can be left chasing logins and account details at exactly the moment they are least equipped to do so. At The Private Office, all clients have access to TPO Wealth, a secure online portal that acts as a digital filing cabinet for exactly this purpose, at no additional cost.
Talk to your family about what you've decided, not just to a solicitor. Most of the stress in these situations comes from people finding out too late, not from the decisions themselves.
Be aware of changes we know are coming. From April 2027, unused pension funds will form part of your estate for inheritance tax purposes, which is precisely why being prepared matters. Not only is this likely to bring more people into the IHT trap - and subject some beneficiaries to income tax as well as IHT - but it will also increase the burden on executors, who will need to account for all pensions held at the time of death. Having your affairs in order, with clear records of every pension you hold, is no longer just good practice; it is something your loved ones will be grateful for. It’s also essential to review who you have nominated your pension to on your death, as the new rules could mean that you might want to change your mind.

Having Peace of Mind

The more assets a family has, the more moving parts there tend to be – pensions, property, trusts, gifting plans – and the more those decisions need to work together rather than being made one at a time.

Talking about what happens when we die is never easy, and it’s understandable that people put it off. But from our experience, the biggest cost of not having these conversations is not only the financial cost, but the additional stress and uncertainty placed on the people we leave behind.

When a family is already dealing with the loss of someone they love, having to untangle their financial affairs or discover that arrangements weren’t quite what they thought, can make an incredibly difficult time even harder.

The good news is that getting your affairs in order doesn’t have to be complicated. A valid will, appropriate powers of attorney, clear records of your finances and some thought about how and when you want to pass on your wealth can make a significant difference.

It’s also important to look at these things as part of one overall plan, rather than as isolated decisions. Taking a little time now to understand what you have, what you want to happen and what your family might need means you can make those decisions on your own terms, rather than leaving them to others at a much more difficult time.

If you're not sure where your own plans stand, or it's been a while since you looked at them, talk to one of our advisers about reviewing them.

*The findings are drawn from a survey of 2,126 The Private Office newsletter subscribers, conducted in May 2026. The sample is weighted heavily towards older, asset-rich homeowners, reflecting the demographic most likely to be engaged in intergenerational wealth transfer. Respondents skewed towards the 65 and over age group (77% of the sample), with 40.1% aged 65 to 74 and 36.9% aged 75 and over. The remaining respondents were aged 55 to 64 (18.2%), 45 to 54 (3.8%) and under 45 (1.0%). In terms of housing status, 91.3% were outright homeowners, 5.5% held a mortgage, 1.4% rented privately, and 1.8% fell into other categories. 75.3% of respondents had children, grandchildren, or both.

This article is intended for general information only, it does not constitute individual advice and should not be used to inform financial decisions.

The Financial Conduct Authority (FCA) does not regulate cash flow planning, estate planning, tax or trust advice.

Editors

Anna Bowes

State Pension to be taxed following rise

The full State Pension is due to rise to above £13,000 a year, raising fresh questions about the growing cost of the system and fairness between generations.

Under the ‘triple lock’, payments rise by whichever is highest of average wage growth, inflation or 2.5%.

The latest figures from the Office for National Statistics (ONS) showed total wage growth, including bonuses, stood at 3.9% in the quarter to July, down from 4.2% in the three months to June. These earnings figures would mean the full, flat rate State Pension would increase by 3.9% or £488 next April to £13,036.40.

However, this won’t be locked in until the inflation figures for September are published in October, as they could in theory be higher than the 3.9% taken from total wage growth. The inflation figures for August were released on Wednesday, showing that inflation had risen to 3.1% in the 12 months to August, up from 2.9% in July.

The State Pension age is rising to 67 in April 2028, but government spending continues to increase. The annual State Pension bill is expected to reach £154bn this year and could rise by a further £600m a year by 2029/30 according to estimates.

Economists have raised concerns about the cost of the State Pension ahead of the Budget, as with this raise, pensioners are beating headline inflation at a time when many are struggling to keep pace, while pensioner groups argue that many older people still face poverty. Additionally, with this increase, the State Pension will breach the personal allowance threshold, making it in theory liable to be taxed.

The ‘Triple Lock’ explained

The ‘triple lock’ refers to a well-known State Pensions policy introduced in 2010 by the Conservative and Liberal Democrat Coalition Government that ensures State Pensions rise every year by either the average earnings growth, inflation (as measured by the Consumer Prices Index) or a flat 2.5% - whichever is highest that year, hence the name ‘triple’ lock.

It was designed in principle to make sure that State Pension value would always have the best growth outcome each year for pensioners. The guarantee that the highest of the three variables will be what pensions grow by ensures that Pensioners have three layers of protection against inflation, hence the name ‘triple lock’. This is incredibly important in maintaining a level of healthy financial security for those relying on their pensions, as it guarantees growth irrespective of how volatile the economy becomes.

If you want to find out more about retirement planning, why not give us a call on 0333 323 9065 or book a free non-committal initial consultation with one of our chartered financial advisers to find out how we might be able to help you.

This article is intended for general information only, it does not constitute individual advice and should not be used to inform financial decisions.