Over my career, I have coached many people on how to build their wealth so they can leave a financial legacy behind for their loved ones. I am also familiar with the statistics regarding the “Great Wealth Transfer” that estimates $68 trillion will be passed down from baby boomers over the next 30 years.[i] Despite these things, I don’t believe it’s a good idea to make plans for money you don’t have. In fact, I strongly urge my younger clients to save for their own financial independence rather than bank on an inheritance to provide for their future.


While it’s true that the baby boomer generation has amassed a great deal of collective wealth, that doesn’t necessarily mean their heirs will see all of it. While this generation has saved a great deal, they’re also living longer. This added time means added expenses. Whether it’s on general living expenses or big-ticket items on their bucket list, many are using their retirement savings to live life to the fullest – and they should! Likewise, with added age comes added health care costs. Statistics show that 52% of people turning sixty-five will need some type of long-term care services in their lifetime.[ii] Such care can quickly deplete savings.


There are many who are part of the Sandwich Generation, those who find themselves pressured to financially help both elderly parents and young adult children, who struggle to have enough for themselves. They too have a road to financial independence that is challenged by longer life expectancies and, consequently, more medical costs. Unlike the Silent and Boomer generation, the Sandwich Generation rarely have an employer pension to rely on. Therefore, they need to save for their financial independence on their own. These savings can be impaired if they need to provide financial aid to ailing parents in their golden years. Some may also experience lost wages while taking care of loved ones, which obviously impacts what they can put away for their own future. Lastly, they may also be helping their grown children financially manage. While I personally stress to clients to work on their own financial independence as there are no scholarships for retirement, I do understand that it can be difficult to watch your children struggle under mountains of student loan debt (for ways to lower or not have student loan debt, see https://www.trilogyfs.com/latest-blog-articles-list/986-college-the-next-chapter-the-selection-process.html and https://www.trilogyfs.com/latest-blog-articles-list/1005-money-management-for-college-students.html).


For some, the issues at hand have nothing to do with the size and scope of an estate. Rather, they believe the lessons learned by building your own wealth means more than actual dollars[iii], and they have no intention of leaving their loved ones a windfall. Others may put restrictions on the wealth they leave behind. They may establish a trust where someone oversees how the wealth is distributed and at what age a beneficiary can receive the funds. They can even go so far as establishing an incentive trust[iv], in which the beneficiaries are required to do or abstain from certain things in order to receive their inheritance. Lastly, if not properly planned for, estate taxes, attorney fees and funeral expenses can whittle down what’s left in an estate.


Please note that I am not writing this blog to instill a sense of fear or disappointment. The baby boomers have long been known as a hard-working, industrious generation. Plan to inherit their sense of tenacity and responsibility rather than their money, and you’ll have all you need to travel down the road to your own financial independence.


 [i] https://www.businessinsider.com/millennial-millionaires-baby-boomer-inheritance-wealth-transfer-2019-10

[ii] https://www.morningstar.com/articles/879494/75-mustknow-statistics-about-longterm-care-2018-ed

[iii] https://blog.massmutual.com/post/why-millennials-should-not-rely-on-an-inheritance

[iv] https://www.investopedia.com/terms/i/incentivetrust.asp


The opinions voiced in this material are for general information only and are not intended to provide specific advice or recommendations for any individual. To determine what is appropriate for you, consult a qualified professional.

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