A new trend is emerging among rich retirees of spending their money on themselves rather than leaving it to their children, a report claimed today.

So-called SKIing, or Spending The Kids' Inheritance, marks a shift in attitude among wealthy people to enjoy their hard-earned cash themselves, and it is often encouraged by the younger generation, according to market analyst Datamonitor.

Report author Laura Meachem said: "Traditionally wealthy investors have looked to transfer most of their wealth to the next generation in the form of inheritance but a new generation of wealthy investors are looking to spend a higher proportion of their money enjoying themselves in retirement.

"They have worked for 30 years to get the money and they are going to make the most of it while they can."

People were also increasingly using their money to help their family while they were still alive, such as by helping them to get on to the property ladder or setting up a stakeholder pension for grandchildren, rather than leaving it to them in a will which would be subject to inheritance tax.

The report found that almost 70 per cent of wealthy people in the UK - those with more than £200,000 in liquid assets - were aged over 55, while there were more rich people aged over 75 than in any other age group.

At the end of 2002 there were 396,000 wealthy retirees, up from 280,000 in 1997, with assets collectively worth £215 billion, compared with £140 billion five years ago.

Datamonitor expects the elderly population to hold an even greater proportion of the UK's wealth in the future as retired people account for a larger proportion of the country's population.

The report found inherent conservatism among the elderly rich had helped to insulate many of them from the worst effects of the stock market downturn.

Miss Meachem added that contrary to the belief that older investors wanted someone else to manage their money, many wished to maintain an active interest in it, not least because it kept their minds active and gave them something to do.

Wednesday September 24, 2003