Canadians' expectations for inheritance may fall short - especially if those over 60 spend it first
WINNIPEG, Feb. 8, 2012 /CNW/ - More than half of Canadians are expecting
an inheritance (53 per cent) and, of those who believe they know the size, 57 per cent
expect the value will be over $100,000. But according to the latest
research from Investors Group, the estimated $1 trillion dollar
transfer of wealth forecast to occur in the next 20 years may result in
fallen expectations for some.
While nearly half of Canadians who have already received an inheritance
prefer not to disclose the size (47 per cent), those who indicated the
amount received an average of $57,000. One in five (18 per cent) who
have already inherited said they received $100,000 or more while one
quarter (26 per cent) received less than $5,000.
Nearly half (45 per cent) of Canadians aged sixty or more are concerned
they are going to need their savings to fund their retirement and won't have money left to give to their survivors. Significantly,
only one-quarter (25 per cent) are willing to make personal sacrifices
to ensure an inheritance for their family.
"As people live longer and have higher expectations for their
retirement, younger generations may have to adjust their own
expectations about the anticipated transfer of wealth," says Christine
Van Cauwenberghe, Director, Tax and Estate Planning at Investors Group.
"This has financial planning implications and strategies that must be
considered by both recipients and benefactors - ranging from retirement
planning and saving to tax planning and insurance planning."
Expectations decrease with age
While the majority of Canadians (53 per cent) think they will receive an
inheritance, expectations decline with age: 80 per cent of Gen Y
(Canadians aged 18-29 years) expect an inheritance but only 62 per cent
of Gen X (Canadians aged 30-44 years) and less than half (48 per cent)
of the boomer generation (Canadians aged 45-64 years) assume they'll be
getting an inheritance.
"Knowing the dollars and cents behind your inheritance can have an
impact on your financial plans," says Van Cauwenberghe. "It is smart to
know what you can expect so you can plan accordingly and family
dialogue is a good place to start."
Having "the talk"
The poll reveals that many families are not taking the time to discuss
or deal with inheritance issues. Four-in-ten Canadians whose parents
have a will (39 per cent) say they have not discussed the terms of the will with
their parents while sixty-one per cent of Canadians with deceased
parents who had a will, admit they never had the talk.
"When it comes to wills in Canada, there's not enough action and
certainly not enough talk," Christine says. "Broaching the sensitive
topics of wills and estate details with loved ones can be daunting but
having "the talk" early on can provide security for planning and make
the process easier when the time comes."
Interestingly, those who have discussed will and estate details with
family members indicate it was not a difficult conversation.
Three-in-ten (31 per cent) said the discussion was very easy while only
three per cent said they found it very difficult.
About the Survey Methodology
This poll was conducted online within Canada between January 12 and
January 25, 2012, among 1,002 adults (aged 18 and over). Data were
weighted where necessary to bring them into line with their actual
proportions in the population. Respondents for this survey were
selected from among those who have agreed to participate in Harris
Decima surveys. Because the sample is based on those who agreed to
participate in the Harris Decima panel, no estimates of theoretical
sampling error can be calculated.
About Investors Group
Investors Group, founded in 1926, is a national leader in delivering
personalized financial solutions to Canadians through a network of
approximately 4,600 Consultants located throughout Canada. In addition
to an exclusive family of mutual funds and other investment vehicles,
Investors Group offers a wide range of insurance, securities, mortgage
and other financial services. Investors Group is a member of the IGM
Financial Inc. (TSX: IGM) group of companies. IGM Financial is one of
Canada's premier financial services companies with over $122 billion as
of January 31, 2012 in total assets under management.
For more media information, please see: Investors Group's Media Room, follow @Investors_Group on Twitter or connect on Facebook.
SOURCE Investors Group Inc.
For further information:
Teresa Pagnutti or Lisa Mills