1.1. The distribution of personal sector wealth between individuals is far more unequal than the distribution of incomes of individuals. Whereas in 1974 the wealthiest 5% owned 47% of all marketable wealth of the personal sector in this country, the share of the top 5% of incomes was much lower at about 20% of total incomes from all sources (before tax). Life-cycle factors would have contributed to this difference because those nearing retirement have had more opportunity to accumulate savings than those early in their careers. But, as will be seen later, such factors provide only a partial explanation and it has become apparent that the greater inequality in the distribution of wealth is due largely to the incidence of other sources of wealth, such as inheritances. In order to throw more light on the processes which have led to the present distribution of wealth it is necessary to consider models of the build-up of savings out of earnings and, also, methods of estimating the overall size and distribution of inherited wealth. These are the main purposes of this paper.