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A new study has warned young adults not to rely on tany inheritance to fund their retirement.

Standard Life research shows more than one in five adults aged 26 to 35 are hoping to bank on their inheritance to see them through their later years.

However, the life assurance and pensions provider said that with more than half of people aged 55 to 65 feeling worse off now than they did 12 months ago - and with just less than half expecting to feel even more worse off in another year's time - young adults should not rely on inheritance alone to fund retirement.

Andrew Tully, pensions policy manager for Standard Life, said: "It is pleasing to see young people giving serious thought to their savings."

However, he warned: "With each generation living longer than the last, and the cost of living rocketing, many parents' plans of leaving behind an inheritance could be foiled."

The research shows 8 per cent of those polled plan to use the money tied up in their property to fund retirement, with 21 per cent claiming they will continue to work beyond their retirement age.

Julie Hutchison, head of estate planning for Standard Life, advised parents to check they are maximising the tax advantages available to them.

She said: "Any inheritance amounts of more than £312,000 are potentially taxed at 40 per cent, making a large dent in the potential nest egg.

"Taking time to write a will and to seek advice from a qualified financial adviser is time well spent and could possibly save thousands in inheritance tax."