501derful.org
Here’s a new story in the spirit of Dickens’ Scrooge. It seems that bequests to baby boomers are falling short of expectations. I recall that about five years ago a study indicated that some $3 trillion was about to change hands from the WWII generation to baby boomers. Many charities were rubbing their hands together with glee because it was expected that even after the boomers got their inheritances there would be a windfall for charities.
The reality is that in 2001 only 26.8% of boomers surveyed got what they expected in inheritances according to an AARP survey. Why the shortfall?
- The BOOM in baby boom means there are more children to spread the wealth among.
- The expiring generation is spending down their assets. They can’t make it on Social Security.
- The retired are living longer and larger and spending their money on better lifestyles.
- Attitudes are changing. The percent who think it’s important to leave an inheritance has shrunk from 55.5 to 46.8 between ’92 and ’98.
But, you major gifts people, don’t despair. This problem is happening mainly among the middle-class. The rich are leaving more than ever.
Experts at the Federal Reserve think that baby boomers will leave more 50 years from now. I seriously doubt that. Speaking as a front-of-the-pack boomer, I predict that baby boomers will spend every nickel they have on rejuvenation, life extension and the best of everything to the last breath.
As the child of baby boomers I can tell you that my generation is not counting on an inheritance. We are preoccupied with planning ways to keep our parents comfortable in the prolonged later years. We will have a mortgage, our children’s college apartments and our parent’s nursing homes to pay for by the time we hit middle age. We are becoming concerned less on how we can live in the lap of luxury and more concerned with how we can afford our parents.