Yahoo Finance 4 Ways Gen X Will Benefit the Most From the Great Wealth Transfer
The “great wealth transfer” is underway. Older generations, primarily baby boomers, are expected to pass on tens of trillions of dollars in wealth to their heirs. There’s one overlooked generation that’s slated to collectively inherit most of this incredible sum of money in the near term and it may not be the generation you’re thinking of, as per Fortune (via Yahoo! Finance).
Check Out: How To Make Passive Income Just By Moving Money In These Ways
Read Next: 4 Genius Things All Wealthy People Do With Their Money
Wealth-X’s 2024 Family Wealth Transfer report indicated that approximately 1.2 million individuals worth more than $5 million are expected to pass on the collective wealth of almost $31 trillion over the next 10 years. To put this into perspective, this collective sum is greater than the total U.S. GDP.
So, who’s first in line to inherit this astonishing amount of wealth? It’s Gen X.
Learn More: 6 Cheap Hobbies To Start in 2024 That Will Make You Extra Money
Wealthy people know the best money secrets. Learn how to copy them.
Gen X Will See Largest Windfalls In The Near Term
It’s shown that Gen Xers will likely see the largest windfalls in the near term. Here’s why.
The Wealth-X study defines members of Gen X as being between the ages of 44 and 59 today, and millennials as between the ages of 28 and 43.
The average age of individuals in the U.S. set to inherit fortunes from parents worth $5 million or more is 46.1 years old. What’s more? The average age of individuals expected to receive the most substantial inheritances from parents worth $30 million or more is 47.6.
The data explains that Gen X is more likely than both millennials and Gen Zers to be first in line to inherit significant wealth from their parents. Meanwhile, millennials and Gen Zers are more likely to inherit sums of money from their grandparents, which are often much less.
4 Ways That Gen X Will See The Greatest Benefit From the Great Wealth Transfer
Here are four ways that Gen X will benefit the most from the great wealth transfer compared to their counterparts:
Their money will have more time to compound: Since Gen X will likely inherit more money in the near term, this means they’ll be able to save more money more quickly. Whether that means parking money in a high-yield savings account, opening a CD, or buying bonds, their money may have more time to compound and grow exponentially over time compared to other generations.
They can make more investments more quickly: By Gen X getting their hands on money more quickly, it means they’ll be able to make more investments even faster. Whether it’s investing in the stock market or buying investment properties, being able to accelerate the rate at which you can invest will mean even more wealth accumulation over time.
They can get out of debt faster: Receiving a financial windfall can equate to Gen X’s ability to pay down or eliminate debt faster. High-interest debt in particular, such as most credit card debt, creates a drain on your finances, and eliminating it should be a top priority.
They can avoid taking on more debt: A large inheritance means cash that can be saved and invested. By building financial reserves, it can make it much easier for Gen X to stay out of debt moving forward. For example, Gen X may be able to make a larger down payment on the purchase of a home, which means lower mortgage payments and fewer interest charges. In addition, having large cash reserves can ensure you have the extra funds needed in case of an emergency. This way, you don’t end up charging that unexpected car repair or surprise medical bill on your credit card.
More From GOBankingRates
These 10 Used Cars Will Last Longer Than an Average New Vehicle
6 Things to Try This Week if You're Behind on Your Savings Goals
4 Reasons Retired Women Need More Money Than Men -- And What To Do About it
This article originally appeared on GOBankingRates.com: 4 Ways Gen X Will Benefit the Most From the Great Wealth Transfer
