Boomers’ New Take on Inheritance Could Spell Trouble for Millennials

2024-06-16

For some, inheritance might seem like a given, but Boomers are starting to follow trends from prominent figures like Warren Buffett and Sting and are moving away from simply passing down wealth. Baby Boomers, set to pass on $68 trillion by 2030, are exploring alternative options that don’t necessarily include traditional inheritances.

Prioritizing Family Harmony Over Wealth Transfer

Image Credit: Shutterstock / Juice Flair

Joe Farren, a wealth advisory expert, points to a growing trend of parents opting to distribute funds during their lifetime rather than waiting until their passing. 

Avoiding Family Conflict

Image Credit: Shutterstock / fizkes

This approach can help ease conflicts amongst siblings after the parents’ death.

A Strategic Move

Image Credit: Shutterstock / Lomb

Farren says, “Some parents aren’t leaving an inheritance after they pass away. They’re giving their kids the money now,” strategically maintaining family unity.

This proactive approach to estate planning points to a better grasp of the dynamics between wealth and family relations.

Living Inheritances and Their Immediate Impact

Image Credit: Shutterstock / Pormezz

Choosing to provide support during their lifetime rather than through posthumous inheritance allows parents – or other benefactors – to witness the positive effects of their generosity.

This approach improves family relationships and gives the parent a say in how the money is used.

Witnessing the Impact of Giving

Image Credit: Shutterstock / 4 PM production

A living inheritance allows people to actively contribute to their children’s and grandchildren’s lives while still alive.

It could help fund education, aid in home purchases, or support entrepreneurial ventures – in whatever method suits the recipient most.

Charitable Giving as an Inheritance Alternative

Image Credit: Shutterstock / New Africa

For many, the idea of leaving a legacy doesn’t necessarily involve enriching their offspring. Instead, they may choose to make substantial donations to selected charities.

A Legacy Beyond Money

Image Credit: Shutterstock / Rawpixel.com

Giving to charity and involving heirs in decisions creates a legacy of caring and community. It’s not just about money but about building purpose and responsibility for the next generation.

Educating the Next Generation on Financial Responsibility

Image Credit: Shutterstock / Zivica Kerkez

Concern about the next generation’s mismanaging of wealth drives many to use their influence to teach financial management.

Farren highlights the importance of guiding adult children in wise financial practices, ensuring the family’s legacy and wealth go beyond immediate gratification. It is more important to foster long-term growth and self-reliance.

Financial Education as a Legacy

Image Credit: Shutterstock / Drazen Zigic

Teaching heirs to manage and grow their wealth effectively is becoming increasingly important in inheritance.

Proper education ensures the financial legacy extends beyond a single generation and promotes a culture of independence and success.

Embracing Life to the Fullest

Image Credit: Shutterstock / Monkey Business Images

Inspired by the philosophy of living well and leaving nothing behind, many Boomers are focusing on enjoying their retirement to the fullest.

This mindset moves away from the traditional idea of accumulating wealth to pass down and leans towards experiences and personal fulfillment.

Retirement and the Joy of Spending

Image Credit: Shutterstock / Xavier Lorenzo

Choosing to enjoy life to its fullest in retirement encourages a reevaluation of the purpose of wealth and prioritizes personal fulfillment and experiences over accumulating assets for inheritance.

The Reality of Retirement Savings

Image Credit: Shutterstock / Carol Heesen

Despite wanting to leave a legacy, financial realities often make this difficult. With the decline of pensions and the reliance on Social Security and 401(k)s, many are struggling to provide a significant inheritance.

Profound changes in the economy have drastically changed what some can leave behind.

Healthcare Costs Devour Savings

Image Credit: Shutterstock / Valeri Luzina

Long-term care expenses present a significant challenge to preserving wealth for future generations.

Without long-term care insurance and the need to pay for care services out of pocket, the ability to leave an inheritance is greatly affected.

A New Paradigm for Wealth Transfer

Image Credit: Shutterstock / Atstock Productions

Inheritance trends are changing, whether through living inheritances, charitable donations, or investments in the financial literacy of their heirs.

There is less focus on leaving money and more on imparting values, experiences, and the tools for financial independence.

The Influence of High-Profile Decisions

Image Credit: Shutterstock / KieferPix

Celebrities’ and billionaires’ decisions to limit or forego traditional inheritances are spearheading this changing perspective.

By spending their wealth, donating to causes, or investing in their children’s capabilities, they are setting a precedence that resonates with many others.

A Legacy of Values

Image Credit: Shutterstock / Potstock

This new way of thinking about inheritance emphasizes education, experiences, and immediate impact and marks a significant shift in how wealth is perceived and transferred.

It reflects a changing understanding of the value of wealth, not just in monetary terms but in the legacy of values, lessons, and opportunities it can provide.

23 Steep Taxes Adding to California Residents’ Burden

Image Credit: Shutterstock / Alex Millauer

California: a place of sunshine, innovation, and, unfortunately, some of the nation’s highest taxes. From LA’s beaches to Silicon Valley’s tech hubs, residents grapple with a maze of state taxes. Here’s a glance at 23 taxes that might surprise both Californians and outsiders. 23 Steep Taxes Adding to California Residents’ Burden

Cash in on Nostalgia: 21 Toys Now Worth a Fortune

Image Credit: Shutterstock / Kostikova Natalia

Time to dust off the boxes and find that once-cherished toy from your childhood. For collectors and enthusiasts, they items have become valued objects and they can be worth big bucks – are there any of these in your attic? Cash in on Nostalgia: 21 Toys Now Worth a Fortune

Millennials Don’t Buy These 19 Products Anymore

Image Credit: Shutterstock / mariakray

Millennials are changing consumer habits, quietly replacing once-staple products and traditions. Often criticized for their disruptive preferences, this generation is reshaping the marketplace with digital expertise, ethical buying, and a taste for the unconventional. Millennials Don’t Buy These 19 Products Anymore

10 Reasons Firearms Are Essential to America’s Fabric

Image Credit: Shutterstock / rblfmr

Americans’ strong attachment to guns is influenced by constitutional rights, historical context, and cultural traditions. This article explores the cultural perspective driving their unwavering support for gun ownership, revealing the key factors shaping this enduring aspect of American life. 10 Reasons Firearms Are Essential to America’s Fabric

California’s 16 New Laws Raise Red Flags for Prospective Residents

Image Credit: Shutterstock / PeopleImages.com – Yuri A

California, celebrated for its beaches, tech prowess, and diversity, is now gaining attention for its recent legislation, prompting some residents to reconsider their residency. Explore the new laws of 2024 and the controversies and migration they’re stirring. California’s 16 New Laws Raise Red Flags for Prospective Residents

The post Boomers’ New Take on Inheritance Could Spell Trouble for Millennials first appeared on Thrift My Life.

Featured Image Credit: Shutterstock / YAKOBCHUK VIACHESLAV.

The content of this article is for informational purposes only and does not constitute or replace professional financial advice.