More young Australians banking on inheritance payouts: CFS

New research from Colonial First State (CFS) has highlighted a gap in the retirement expectations of younger Australians versus the “realities” of their older relatives, with many now relying on an inheritance to secure their finances.

A survey of 2,250 Australians indicated that nearly half of the 18-to-29-year-old cohort expect an inheritance, at an average amount of over $525,000. This is almost double the amount expected by those aged 50 to 64 years old.

Kelly Power, CFS Superannuation’s chief executive, said the results suggest younger Australians have underlying concerns about the stability and security of their financial futures and are seeking alternate sources of comfort.

“Young people are hopeful about receiving financial support in the form of an inheritance due to rising living costs, stagnant wage growth and housing pressures,” she said.

“At the same time, older generations are navigating the complexities of retirement planning. They want to support their families while ensuring their own financial security. It’s a delicate balance that requires careful planning and open communication.

“Sitting down with a financial adviser can be hugely valuable for families as they navigate the unique financial challenges of different life stages.”

According to the survey, only 38 per cent of respondents have a will despite the majority agreeing they plan to leave an inheritance. The results have raised questions regarding the split of assets between an inheritance and retirement income, with the family home, vehicles and remaining superannuation falling under the inheritance umbrella; investment portfolios and other property were largely selected for retirement income.

CFS’ Head of Technical Services, Craig Day, said the survey highlights the mentality shift in older Australians as they are increasingly forced to choose between “leaving a legacy” and funding their retirement.

“With longevity increasing, many people may need to start prioritising financial security over inheritance planning,” Day said.

“Young people may be overestimating the size and certainty of future inheritances. As their parents enter retirement, the focus could be shifting from wealth transfer to sustaining a modest, debt-free lifestyle.

“It’s important that young and old can discuss their expectations and plans openly. By having these conversations early, families can ensure that everyone is on the same page and can make informed decisions that align with their values and goals.

“It’s not just about passing on wealth—it’s about passing on clarity. Families need to talk about their intentions, their needs, and their plans. That’s where advice becomes invaluable.”