UK society faces a once in a lifetime opportunity that we need to ensure we grasp and maximise. 80 per cent of people aged over 65 have equity in their property and this will result in a tsunami of inheritance of an unprecedented level over the next 20 years. Never before has there been such a spread of wealth across the whole of society, sitting with a group that are also recipients of generous private and state pensions, enabling them to pass a substantial proportion of their housing wealth down to the next generation.

However, we need to ensure that two things happen:

1)   That customers understand the consequences of their spending choices during the lifetime of the individuals that own this wealth

2)   We look at the bigger picture and the needs of younger generations

We are already seeing equity release offerings targeting older generations, encouraging them to build conservatories and go on exotic holidays. We should take care to balance the additional comfort and experience this provides with how that cash might be used to support the wave of seven million people aged over 50 who are heading towards retirement with too little in their pots and facing a very uncertain future. We also need to consider the even bigger impact when helping generations in their 20s and 30s who need help getting onto the housing ladder, and who also have the benefit of being able to leave lump sums of cash growing for between 40 to 50 years to support their retirement.

Financial services firms should be encouraging families to look at the resources they have available to them and to think about how these can be deployed to make a real difference for future generations. For example, grandparents taking the decision not to build a conservatory in favour of providing a retirement income for three grandchildren. Gifting to younger generations could allow them the flexibility to make savings decisions between the short and longer-term, whether saving for a house or saving for retirement

We need to collectively ensure that the national treasure of housing wealth that resides with the older generations provides as much benefit to future generations. We need to start building a new paradigm of family financial planning today.

David Dalton-Brown will be speaking at the forthcoming Later Life Lending Conference taking place in London on Thursday 11 July. View further details and book your ticket here.