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69% of Australian Retirees expect to leave a very significant inheritance to their children; HSBC Survey
Topic Started: 21 Sep 2014, 11:17 PM (11,719 Views)
peter fraser
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AUSTRALIAN RETIREES EXPECT TO LEAVE FAR GREATER INHERITANCE THAN ANY OTHER NATION SURVEYED BY HSBC.

HSBC "Life after work" report can be down loaded in pdf format here - http://www.hsbc.com/about-hsbc/structure-and-network/retail-banking-and-wealth-management/retirement#select-report

This is a global report that represents the views of more than 16,000 people in 15 countries taken between July 2012 and April 2013.

On average 69% of retirees expect to leave an inheritance to their children. Australian retirees match that average exactly at 69%

The highest is India with 86% and the lowest is the USA at 56% (refer page 26)


The actual value of the inheritance varied across nations depending on the wealth of the people as one would expect.

The nation that expected to leave the greatest inheritance was Australia at $501,909 followed by the USA with $176,814.

The lowest expected inheritance was India with $47,775 although the UAE and Egypt offer no data on that question.

The average is $148,205

(refer page 26 of the report)

This is a very interesting report that is worth reading. I was quite surprised at how much more Australian retirees intend to leave their children when compared to other nations in the survey.

The 2014 report should be released in December. It will also be interesting to see if there are any changes.

Edited by peter fraser, 21 Sep 2014, 11:18 PM.
Any expressed market opinion is my own and is not to be taken as financial advice
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ThePauk
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So by this 31% expect to leave nothing. Got it.
I was looking for up to date info to use, thanks.
And I asuume that it the current retirees, so not the boomers. Noted.

The Key Findings are interesting..

Nearly three-fifths of Australian respondents think their financial preparations for a comfortable retirement are inadequate: 37% feel they are not preparing adequately and 22% are not preparing at all.
• People run the risk of living long beyond their retirement savings: on average, Australian respondents expect their retirement to last for twenty- one years, but their retirement savings to last for only eleven years.
• The average Australian respondent believes that 30% of their retirement income will come from the state, rising to 41% amongst 55-64 year olds, while 47% expect to use cash savings as a form of retirement funding.
• Respondents understand the importance of preparing for retirement from early on in life: on average they see the age of
36 as the latest by which people can start planning financially and still expect to maintain their standard of living in retirement.
• More than in nearly any other country surveyed, respondents in Australia prioritise saving
for the short term goal of a holiday over saving for the long term goal of retirement. When asked if they could only afford to save for one of these options for a whole year, 53% chose a holiday, whilst only 36% chose retirement.
• Fear of financial hardship in retirement is the most common motivator for financial planning with 47% of respondents stating that this is their reason for starting to plan. Other more positive triggers such as paying off the mortgage (22%) or paying off debt (14%) were less important triggers.
• In Australia, there is a strong relationship between financial
planning and saving more, when looking at the retirement savings levels of respondents with similar incomes. Here, those who undertake either formal or informal planning have over five times the retirement savings of those who have not planned.Those who consult a professional financial adviser are also better off and have nearly a third more in retirement savings than those who have not used such advice.

37% say buying a home has affected their ability to save for retirement
Edited by ThePauk, 22 Sep 2014, 12:00 AM.
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peter fraser
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ThePauk
21 Sep 2014, 11:48 PM
So by this 31% expect to leave nothing. Got it.
I was looking for up to date info to use, thanks.
LOL - it exactly matches a 15 nation average.

What were you expecting 100% - remember that only about 70% of people own a house, which closely matches those who expect to be able to leave an inheritance.

It's highly likely that the 31% who don't expect to be able to leave an inheritance are those who don't own their own home. Home ownership makes huge difference to household wealth and ability to leave an inheritance.

I would interpret this data as "virtually everyone who owns a house expects to leave a substantial inheritance to their offspring" - and a much more substantial than any other nation in the survey.
Any expressed market opinion is my own and is not to be taken as financial advice
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ThePauk
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Noted Peter. So SKIN and such is not actually happening or planned. Those websites must be run by trolls...
Also noted that this does not represent boomer intentions and that you "guess' that people will leave nothing as they have nothing.

70% as outright owners? wow, the PLS will be a complete success.
"State pensions are the most important retirement income source: amongst retirees, 43% of income comes from state pensions/benefits, ahead of personal pensions (25%)." and thus the urgent need for aan enhancved PLS.

Other tidbits that justify a PLS and an PPOR asset test...
Respondents in Australia would rather save for a holiday than for retirement...
38% of retirees say that financially they have not prepared adequately or at all for a comfortable retirement...

Intent of Lucky generation is 69% however...

"However, receiving a significant financial gift or loan from parents is not common: only 22%
of pre-retirees have received such a gift and 11% a significant loan, while fewer retirees have themselves benefitted from this type of legacy (21% receiving a gift, just 5% a loan). Gifts or loans from relatives to younger people (25-34 year olds) are a little more common: 27% have received a gift, 14% a loan."


Thanks again Peter, some really valuable data for me to use.
Edited by ThePauk, 22 Sep 2014, 12:14 AM.
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We can only assume you are ignoring the point on purpose - if you buy a house one day you WILL own it outright.
It's funny the way some people will rail against facts that don't suit them to the exclusion of even the smallest shred of common sense.
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peter fraser
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ThePauk
22 Sep 2014, 12:06 AM
Noted Peter. So SKIN and such is not actually happening or planned. Those websites must be run by trolls...
Also noted that this does noit represent boomer intentions and that you "guess' that people will leave nothing as they have nothing.

70% as outright owners? wow, the PLS will be a complete success.
"State pensions are the most important retirement income source: amongst retirees, 43% of income comes from state pensions/benefits, ahead of personal pensions (25%)." and thus the urgent need for aan enhancved PLS.

Respondents in Australia would rather save for a holiday than for retirement...
I think that what it means is:=

1. Australians who own their home are assisting their children before they die. (page 24)
2. Australian retirees are where possible leaving an inheritance to their children.
3. Retirees probably are spending a portion of their own money on themselves, but doesn't everyone. It's actually quite grotesque of the offspring to expect otherwise.
4. you want to punish boomers by taking whatever they have off them, which in turns punishes Gen X and in particular Gen Y
5. Your theories are in the toilet.
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Sober
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ThePauk
22 Sep 2014, 12:06 AM
Noted Peter. So SKIN and such is not actually happening or planned. Those websites must be run by trolls...
Also noted that this does not represent boomer intentions and that you "guess' that people will leave nothing as they have nothing.

70% as outright owners? wow, the PLS will be a complete success.
"State pensions are the most important retirement income source: amongst retirees, 43% of income comes from state pensions/benefits, ahead of personal pensions (25%)." and thus the urgent need for aan enhancved PLS.

Other tidbits that justify a PLS and an PPOR asset test...
Respondents in Australia would rather save for a holiday than for retirement...
38% of retirees say that financially they have not prepared adequately or at all for a comfortable retirement...

Intent of Lucky generation is 69% however...

"However, receiving a significant financial gift or loan from parents is not common: only 22%
of pre-retirees have received such a gift and 11% a significant loan, while fewer retirees have themselves benefitted from this type of legacy (21% receiving a gift, just 5% a loan). Gifts or loans from relatives to younger people (25-34 year olds) are a little more common: 27% have received a gift, 14% a loan."


Thanks again Peter, some really valuable data for me to use.
So your entire premise about Boomer financial legacy plans is now holed below the waterline, yet you still desperately want to believe that Boomer = absolutist SKIN philosophy, and that your PLS and PPoR asset test policies are the only solution to your imagined dastardly Boomer-generation SKIN master-plan.

It's never been clear why, mind you.

:lol :lol :lol

But with Boomers now evidently all too prepared to support their offspring as estate legatees, in world league table-topping proportions no less, it seems you've invented a new bete noire to pick on...saving for a holiday!!!

Just what, exactly, is the connection between the Australian propensity to take a holiday, and you PLS/PPoR asset test schemes???

Edited by Sober, 22 Sep 2014, 05:41 AM.
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Lef-tee
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Nobody means to do any harm.

But the question of "do you intend to leave your children anything" is a loaded one. Seriously, what would most of us answer in response to that question, regardless of our actual intentions?

Deliberately leaving nothing goes against the prevailing broader social expectations and answering no in response to such a question invites the judgment of others. Remember Alfred Kinsey who did volumes of research into human sexual behaviour? Many of his conclusions were based on answers given in interviews. Others have since pointed out that his research suffered from a serious oversight - it assumed that respondants were telling the truth. Women and homosexuals in particular would have felt compelled to lie because of the social stigma attached, especially in the era the research was done, probably not so much nowdays.

So while these surveys are interesting I think the value of them might be limited due to uncertainty surrounding the accuracy.
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They EXPECT to , do they Peter, big word, like 'if'. Many also EXPECT prices to double every seven to ten years too. Good luck....

The government EXPECTED mining pricez to remain at $130 in 2014, they expected to have a budget surplus in 2012, they actually promised it, better than an expectation yet it did not happen. Big words from many unable to see the bigger picture or that many will actually come out in a far worse position through overleverage and economic decline.

Good luck.....
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peter fraser
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Lef-tee
22 Sep 2014, 07:59 AM
Nobody means to do any harm.

But the question of "do you intend to leave your children anything" is a loaded one. Seriously, what would most of us answer in response to that question, regardless of our actual intentions?

Deliberately leaving nothing goes against the prevailing broader social expectations and answering no in response to such a question invites the judgment of others. Remember Alfred Kinsey who did volumes of research into human sexual behaviour? Many of his conclusions were based on answers given in interviews. Others have since pointed out that his research suffered from a serious oversight - it assumed that respondants were telling the truth. Women and homosexuals in particular would have felt compelled to lie because of the social stigma attached, especially in the era the research was done, probably not so much nowdays.

So while these surveys are interesting I think the value of them might be limited due to uncertainty surrounding the accuracy.
This report looks entirely logical to me. Our pension scheme is designed to allow home owners to keep their house and if they have some savings or a pension they can with a part pension manage until death and then leave their house to their children. It's unlikely that the average household would also have a mountain of cash stashed away.

If you look at the value of $501,999 expected to be left to the offspring it closely resembles the median price of a house in Australia.

If you look at the value of the expected inheritance of $176,814 in the USA it closely resembles the median price of a home in the USA. So what we have is evidence that similar people in a similar society with a similar aged pension system expect to do much the same thing.

Who would have thunk it?

Not much evidence of grannies sitting in $5M mansions with $1M in cash drawing a pension of $1 per fortnight though.

Lets face it leftie, Pauls theory is nothing more than a complete beatup.
Any expressed market opinion is my own and is not to be taken as financial advice
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