Gen Z – betting on an inheritance – time to stand on your own two feet?

Retirement can seem an age away when you’re in your twenties and thirties, but it’s never too soon to start saving for the future. The earlier you start, the bigger the pot when you retire. 

Inheritance – no longer a sure bet 

Around a quarter of Gen Z and Millennials aren’t thinking about how they will fund their retirement because they expect to inherit money or property in the future, according to recent data¹. With higher care costs, longer lifespans, frozen tax thresholds and changing Inheritance Tax rules, this could prove a risky strategy. The timing and value of an inheritance can’t be guaranteed, which could result in a big financial black hole later in life. 

Saving doesn’t have to be taxing  

Even if you are saving for other big life events, such as buying a new home, see if you can put aside a dedicated amount every month for your pension. Regular contributions over a long period of time soon add up and can benefit from growth over the years to retirement. These regular contributions can be topped up with lump sum payments over the years, such as bonuses. And don’t forget the government’s role – each contribution you make, currently up to 100% of earnings and within the £60,000 Annual Allowance, benefits from tax relief, boosting your savings straight away. 

Make your pension work harder 

Remember to: 

• Start early – small, regular contributions benefit long-term from compounding 

• Max out employer pensions and contributions to boost pension savings 

• Think about combining small pension pots from previous jobs for easier tracking and potential cost savings 

• Pensions are long-term investments – don’t panic over short-term dips in performance. 

The message is – don’t rely on anyone else to fund your retirement – nothing is guaranteed. 

¹Standard Life, 2025 

The value of investments can go down as well as up and you may not get back the full amount you invested. The past is not a guide to future performance and past performance may not necessarily be repeated.