The inheritance conversation most families put off (and why it matters now) 

If you want more control and clarity, it helps to treat “wealth transfer” as part of retirement planning, not just an estate planning task. That means looking at how and when money moves, who it helps, and what it could change for your family’s tax position and government benefits.

If you do nothing, most wealth transfers “involuntarily” through your estate when you die. For many families, the plan is simple:

• make a will that leaves everything to your spouse if one of you dies
• when you have both passed away, the children split what’s left

There is nothing wrong with that approach. The risk is that once the will is done, the conversation stops for decades, even as your life changes, your assets grow, tax rules shift, and your family’s needs evolve.

Longevity is a good news story, but it changes the timing of inheritance.

Australian Institute of Health and Welfare data (June 2026) suggests that, at age 65, life expectancy is around 85 for men and 88 for women. For couples, the last surviving spouse is statistically likely to live longer than the “single person” life expectancy figure.

That often means adult children inherit when they are closer to 60 and starting to plan their own retirement. At that stage, an inheritance may still be meaningful, but it is less likely to be life-changing than it would have been earlier, such as when paying down a mortgage, managing school fees, or building financial security.

This is where voluntary wealth transfer comes into the conversation.

Voluntary wealth transfer means choosing to pass on assets during your lifetime, rather than only through your estate.

Some people do this to help family members at a specific life stage, to fund education, to support a first home purchase, or to leave a legacy to a charitable organisation. Others want to reduce complexity for their estate or create a clearer plan while they can still be part of the conversation.

It can be a powerful strategy, but it is not one-size-fits-all. Before transferring anything, you need to confirm your own financial position and the flow-on impacts for you and your beneficiaries.

A practical way to begin is to separate your goals into two groups:

1) Your personal goals

These are the non-negotiables: day-to-day living costs, planned lifestyle expenses, major ad-hoc costs (holidays, cars, home repairs), and later-life needs such as in-home care services or moving into a retirement village or care facility.

2) Your additional goals (if you have surplus)

If financial modelling indicates a surplus may remain at life expectancy, you can explore non-personal goals: leaving an inheritance on death, making gifts at specific life events, helping grandchildren, or supporting causes you care about.

Your financial advisor can help you test what’s realistic and sustainable and identify which assets might be appropriate to transfer.

Wealth transfer decisions can affect more than your bank balance. Three areas commonly surprise families:

Centrelink and the Age Pension

Eligibility for the Age Pension can change when assets move, and the rules differ depending on whether you are assessed as a couple or a single person. It is also important to understand gifting rules. In some cases, transferred assets can remain assessable for a period of time, beyond a small allowable threshold.

Superannuation death benefits

When you die, your superannuation is generally paid out, and it can be taxable depending on who receives it and the components of the benefit. For example, tax may apply to adult, financially independent children receiving certain components, while different treatment can apply for a spouse. Untaxed schemes and insurance proceeds inside super can also be treated differently.

Tax outcomes for the recipient

A transfer that feels generous can create a tax issue if it changes who owns an asset, triggers capital gains tax, or shifts investment earnings into a higher marginal tax rate environment. The “best” tax outcome depends on both sides of the transfer: your circumstances and the recipient’s.

A wealth transfer strategy works best when it is understood and agreed, not assumed. In many cases, a joint family meeting with your financial advisor can help everyone get aligned on intent, timing, and trade-offs, while keeping the discussion structured and respectful.

If you are thinking about intergenerational wealth transfer, a clear sequence helps:

1. Understand your financial goals
2. Evaluate your retirement funding with your financial advisor
3. Clarify what you want to achieve for beneficiaries
4. Build a plan that accounts for tax, Centrelink, and superannuation impacts

The aim is not to rush decisions. It is to replace “we’ll deal with it later” with a plan you can explain, test, and adjust over time.

If you have any questions about these changes and how they relate to you, please speak to your Mercer Financial Adviser.