The largest generational transfer of wealth in history is starting to happen. It is important that families talk and make plans for it.
In the next couple of decades, the world will see what many are calling the “Great Wealth Transfer.” Trillions of dollars will flow from wealthy Baby Boomers to their heirs in Generation X and the Millennial Generation.
It is believed to be the largest such transfer of wealth between generations that the world and the U.S. has ever seen. This leads to real concerns whether younger generations are prepared to handle the wealth.
If it is not managed appropriately, then the possibility of all of that wealth being squandered could become a reality, as Private Wealth discusses in “Open Channels.”
Making sure that inherited wealth is not wasted, is something that must be done on a family by family basis. The younger generations need to be adequately prepared to manage inheritances from Day One.
Two basic things are needed to make sure that things go smoothly.
The first is that baby boomers with wealth need to have solid estate plans that appropriately detail how the wealth is to be transferred to heirs. The second is that heirs need to be educated about what to do with that wealth.
All of this starts by talking to heirs about what they will receive and how it should be handled. It also requires making sure that heirs have the appropriate experts to turn to for advice, if needed.
If you have not made plans for the Great Wealth Transfer and your family’s part in it, then speak to an estate planning attorney and get started.
Reference: Private Wealth (March 21, 2017) “Open Channels.”