How Millennials Could Get Rich During the Great Wealth Transfer
Written by
Caitlyn Moorhead
Edited by
T. Woods
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No matter the generation you were born into, whether you’re a boomer, Gen X, millennial, Gen Z or younger, odds are that you’re no stranger to money woes or a volatile economic climate. While boomers and Gen X hold most of the wealth in the United States at the moment, there is going to be a major shift in that wealth very soon.
In case you haven’t heard, the Great Wealth Transfer will happen when boomers and Gen Xers pass down their money, real estate and other assets to their millennial heirs and inheritors. This, in turn, will have a huge impact on economic and market conditions. Keep reading for an overview of what you can expect should a windfall come your way.
Quick Take: What Is the Great Wealth Transfer?
Though estimates vary, essentially the “Great Wealth Transfer” is the term used to describe when approximately $84 trillion in assets pass from boomers to younger generations, businesses and charitable organizations over the next 20 years.
As baby boomers are the largest generation thus far to go through retirement and estate planning, this will likely be the biggest passing of wealth in the history of the United States. This will have a huge impact on not only the anticipated heirs and recipients but also the global economy as a whole.
Here are some projections for what the estimated wealth to be inherited through 2045 by generation will look like:
- Boomers: $4 trillion
- Gen X: $30 trillion
- Millennials: $27 trillion
- Gen Z: $11 trillion
What the Great Wealth Transfer Will Look Like
The 2024 Wealth Report from real estate firm Knight Frank suggests that upwards of $90 trillion in assets will transfer from Boomers and Gen X to Millennials in the United States. This shift in wealth is expected to occur over the next 20 years, making Millennials the richest generation.
However, a significant portion of wealth — on the order of $68 trillion — will move to millennials by 2030, according to Coldwell Banker. In fact, Coldwell Banker estimates that “by 2030, millennials will hold 5 times as much wealth as they have today.”
While you may stand to inherit some money in the Great Wealth Transfer, it’s important to avoid relying on an inheritance in your financial plans. There is always a possibility that your parents and grandparents may reconsider or find they need to spend their wealth on retirement or healthcare.
Final Take To GO
The bottom line is that financial planning is key if you believe you will benefit from the Great Wealth Transfer. It can be helpful to find a financial advisor who aligns with your needs, and start thinking about an investment strategy.
Since investment priorities vary widely between older generations and Millennials, including ethical investing and carbon reduction, financial advisors will be trying to adapt to the shift in priorities for their new, richer clients.
Becky Neubauer contributed to the reporting for this article.
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