Great Wealth Transfer? See How Much Money Boomers Actually Plan To Pass Down
Back in 2022, financial market intelligence firm Cerulli and Associates estimated the Silent Generation and boomers will pass down $84 trillion in assets through 2045.
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Nearly $73 trillion of this is predicted to go straight to their heirs in what the Bank Administration Institute calls, “the greatest transfer of wealth in history.” The remaining $11.9 trillion is likely to end up at charitable organizations.
Multigenerational wealth is one of the most tried-and-true strategies of building long-term financial stability for families. And with these kinds of numbers, you might assume the Great Wealth Transfer is about to shake things up.
While it might, not everyone plans to leave behind a ton of assets. The vast majority of this wealth — $53 trillion — is currently held in the hands of the baby boomers. Despite this, many individuals in this generation anticipate they’ll have relatively small sums to pass down to their descendants or other family members.
Here’s how much money baby boomers plan to pass down to their heirs and some of the potential effects of the Great Wealth Transfer.
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Nearly a Quarter of Boomers Don’t Plan To Leave Behind Anything
Anyone born from around 1946 to 1964 is in the baby boomer generation. As of 2024, this means these individuals are between the ages of 60 and 78.
GOBankingRates recently surveyed a pool of 999 American adults to find out how much money they plan to leave behind to their children or family. Here’s what those between the ages 55 and 64 said:
37.43% don’t plan to leave behind any money
26.20% expect to leave behind less than $10,000
7.49% anticipate passing down $10,001 to $50,000
10.7% expect to leave behind $50,001 to $100,000
18.18% said they’ll leave behind more than $100,001
While the results may be slightly skewed since some respondents were not quite in the boomer generation, GOBankingRates also surveyed those ages 65 and up to get their numbers. Here’s what they said:
33.66% don’t expect to leave anything behind
20.30% think they’ll have less than $10,000 for their families
12.87% anticipate passing down $10,001 to $50,000
8.42% said they’ll leave behind $50,001 to $100,000
24.75% anticipate leaving behind $100,001 or more
For the most part, the percentages don’t vary that much. The oldest group of respondents did seem more confident in their ability to leave behind a larger amount of money to their heirs, though.
As part of the survey, GOBankingRates also asked respondents of all ages how much they anticipate being able to pass down to their children or other family members. Age aside, these are the results:
33.13% said $0
20.92% said less than $10,000
15.02% said $10,001 to $50,000
11.81% said $50,001 to $100,000
19.12% said more than $100,001
This is about on par with what the older respondents specifically indicated. The most notable discrepancy is for those who said they plan to leave behind between $10,001 and $50,000 as fewer older individuals anticipate these numbers.
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Short-Term Effects of the Great Wealth Transfer
The short-term effects largely depend on how much money gets left behind — if any.
“With $84 trillion set to change hands, we’re talking about a lot of money moving around,” said Joseph Camberato, the CEO at National Business Capital.
“For some families, this could mean suddenly finding themselves with more financial power than they ever expected. Even people who are already doing well might see their situation improve.”
He continued, saying, “When people receive a large amount of money, they often spend it, so in the short term, this could boost consumer spending, which has been on the decline lately.”
Long-Term Effects of the Great Wealth Transfer
There could also be some long-term effects of this intergenerational wealth transfer.
“Over time, this wealth transfer could help lift families into higher income brackets. As an example, middle-class families might find themselves moving into the upper-middle class,” said Camberato.
“The transfer isn’t just about cash; it includes assets like real estate, stocks and retirement accounts,” he continued. “Many Baby Boomers and older generations own their homes outright, and in many areas, those homes are worth a lot — anywhere from $500,000 to $1 million.”
Inheriting a paid-off home could be a game-changer for many families. Given this, Camberato also predicted there’ll be more homes back on the market as a result.
“A lot of older homeowners have stayed in place because of the pandemic and rising home prices. But as these homes get passed down, many people will either sell them or move into them and sell their current homes,” he said.
“Most won’t want to deal with the hassle of owning two homes, so this could increase the number of houses available for sale.”
The Bottom Line
Despite the trillions of dollars expected to trickle down in the coming two decades, not every boomer will leave behind a vast fortune.
“For the average person, the odds of leaving behind significant wealth are slim,” said David Materazzi, the CEO of Galileo FX. “Rising costs and stagnant wages make it a tough climb. Only those who can play the game smarter, investing wisely in growth sectors, stand a chance.”
But for some people, even receiving a small inheritance — especially if it comes in the form of real estate or other assets — can be quite beneficial.
“Even if it’s just a home, in today’s market, that can be a substantial amount of money,” said Camberato. “For many families, this will be a meaningful transfer of wealth.”
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This article originally appeared on GOBankingRates.com: Great Wealth Transfer? See How Much Money Boomers Actually Plan To Pass Down