The great wealth transfer is occurring, but not in the best way you think that

The largest transfer of wealth in history is going down today – from one family to the following, from one generation to the following. According to a study by Edward Jonesin collaboration with NEXT
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According to 360 Partners and Morning Consult, nearly one-third of all Americans have received or will receive an inheritance. Of those expecting an inheritance, nearly half expect it to occur inside the following 10 years, an event many are calling the good wealth transfer.

Accordingly Cerullithe Great Wealth Transfer, is the projected handing over of trillions of dollars from the older Silent Generation and aging Baby Boomers to their young adult children and grandchildren of Generation X, Millennials, and Generation Z over the following 20 years. Cerulli estimates the transfer will come primarily from the Baby Boomers and total nearly $84 trillion, with about $72 trillion going to heirs and $12 trillion going to charities. That’s a variety of money. Well, it might not all be money. The Great Wealth Transfer will include money, stocks, real estate, and other types of wealth, and for a lot of, memories. Adult children anticipating an eventual wealth transfer could also be uncertain about what, how, and in what form that transfer will happen.

“Talking to loved ones and planning ahead are the most important parts of the wealth transfer process,” says Lena Haas, Principal, Wealth Management Advice and Solutions at Edward Jones. “Having an open conversation with family members and developing a clear plan can make the difference between a legacy of love and care and a legacy of potential hurt and confusion.”

The great wealth transfer is occurring now, but not quite in the best way you imagine. Yes, there will probably be wealth in the normal sense, but many aging baby boomers produce other ideas, including shared family travel and experiences that they and their families can enjoy together today.

Giving and living

Although it isn’t often or loudly discussed, the key wealth transfer is about greater than just money; it is usually concerning the death of grandparents and oldsters. Many older adults don’t wait until the tip of their existence to offer. Instead, many select a special strategy than the normal wealth transfer recorded in wills and trusts: they select to offer while they’re still alive.

Lifetime gifting isn’t a brand new idea. Without eager about it, parents routinely divert savings that may very well be used for retirement and family wealth to their kid’s college funds. Later, those self same parents may pay for weddings. Parents and grandparents may help buy a brand new house for a young couple. One trend that has clearly gained momentum, nevertheless, is the joint gift of a visit.

Multi-generational travel

Since the tip of the pandemic, travel has exploded. You might call it revenge travel, but every generation is desperate to hit the streets and runways. A significant trend within the travel industry is multigenerational travel, where typically older adults organize, finance, share experiences and create memories with their adult children and grandchildren.

According to Jim Staples, President of Orbridgean organization specializing in travel destinations: “One of the biggest trends we are seeing is that intergenerational travel has increased significantly. Baby boomers are going on more frequent trips of discovery with families both large and small.”

The 2023 US Family Travel Association survey of three,300 parents and grandparents say 50% of respondents have taken a multigenerational trip up to now three years. In addition, greater than half (54%), especially grandparents, say they’re the most important planners and organizers of the trip. A full 50% of respondents say they pay for the trips with their children and grandchildren, while one other 48% say they split the fee with family, and just one% say their children pay for the trip.

For aging baby boomers, travel isn’t concerning the trip itself, but about using today’s wealth to gift shared experiences and create memories as a family. Orbridge’s Staples notes, “We hear time and time again from our clients that the parents or grandparents want to experience this (travel) together with their family. People see travel as a way to connect, create and share memories and build a bond. As those with the financial means get older, they want to spend that bonding time with their children and grandchildren… experiencing something brand new with the people they love as they age is irreplaceable.”

Mom and Dad’s travel list may not only include adult children and grandchildren. Staples notes, “There can be a certain dynamic in these family departures when part of the family decides to leave, sometimes including more extended family members, cousins, nieces, etc., who then also join the departure so as not to miss out on any memories.”

But wait, before the adult children of Millennials and Generation Z pack their bags and head off on a visit with mom and pop, they might must wait. According to AARP, travel by the “skip gen” could also be on the rise. In a 2019 study Opinion poll61% of grandparents said they were keen on vacationing with their grandchildren alone, skipping the center generation.

The Great Wealth Transfer will undoubtedly live as much as its name in the approaching a long time; it’ll be an unlimited amount of wealth. However, the common notion that enormous checks, houses or portfolios are the one assets transferred isn’t mistaken, but incomplete. Lifetime giving is a present that aging parents and grandparents may give their families, but additionally something they will enjoy while they’re alive. The shared family experiences, memories, heartfelt conversations, hugs and inevitable selfies that always accompany a family outing are real wealth that can’t be quantified.