Parents with more wealth to pass on are more likely to split their assets unequally between their children, new research by Netwealth has suggested.

Findings from the wealth manager indicated that only 28% of those on the upper end of the wealth spectrum – those with over £500,000 in investable assets – plan to split their wealth equally between their children.

This figure, based on a study among 2,000 people, compared to around two in three of those on the lower end of the scale (66%).

The study was produced with Emma Maslin, financial coach and founder of personal finance education website, The Money Whisperer, and looked at attitudes and behaviours towards intergenerational wealth planning among parents with varying levels of investable assets.

Netwealth suggested that parents with over £500,000 in investable assets are almost three times more likely than those at the lower end of the spectrum not to split their wealth evenly, because their children have families of varying sizes and they would prefer to provide for their grandchildren equally (20% vs. 7%).

The research suggested they are also three times more likely to distribute their assets unevenly as a result of their children having different approaches to money, and almost four times more likely not to split equally because they are estranged from one of their children.

“Passing down wealth to the next generation can be complicated for many families,” said Netwealth CEO, Charlotte Ransom. “There are many important factors to consider as people lead increasingly complex financial lives.

“While there is no one-size-fits-all approach to how you divide up your wealth, having transparent conversations early on about individual needs and expectations, alongside professional support and guidance, can make all the difference.

“Our research highlights that wealth levels can lead to different approaches to dividing family finances. For those with larger estates, giving children different amounts is often a function of their children’s needs over time and their approach to money.”

However, the research also found that one in five parents polled (19%) have not openly discussed their plans for their wealth with their children, which Netwealth highlighted could lead to family tensions or financial issues further down the line.

Ransom continued: “Having open discussions about wealth transfer allows for a higher likelihood of understanding and buy-in. It can also help to involve an adviser as a neutral third party who can help guide some of the decision making depending on the needs of the next generation and address potential misunderstandings ahead of time.”

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