Advice firms reported on average about a fifth of their clients had already gifted money to children or were considering doing so, according to the Just Group Care Report.

In about a quarter of cases (26%) advisers felt obliged to challenge their client’s wish to gift any money or to encourage them to give a lower amount.

The top three reasons given by advisers challenging the clients’ wishes were because the client had not considered how long they might live and need income (67%), how they might pay for care in later life (48%), or the client did not have enough money to give away (40%).

The report also highlighted low levels of engagement with care planning. Around four in five (77%) of over-55s surveyed said they have not through about care, planned for it, or spoken to family about it.

Stephen Lowe, group communications director at Just Group said: “The Bank of Mum and Dad is very much open for business with almost all advisers (95%) having at least some clients who wish to make living inheritances to their children. But with about one in four clients advisers face the tricky challenge of how to make their clients reconsider the wisdom of giving money away early.

“Advisers tend to deal with wealthier people but even so their insight and expertise means they will sometimes have to challenge a client’s plans to make financial gifts. These can be difficult conversations but advisers understand it is important they raise these concerns because their experience suggests the client may otherwise face financial hardship later.”