The Blubber

Baby Boomers are notably the least inclined among generations to pass on their wealth during their lifetimes, according to a new survey by Charles Schwab.

The survey found that only 21% of Boomers with at least $1 million in investable assets expressed a desire to share their wealth with the next generation while they are still alive. This contrasts sharply with 53% of Millennials and 44% of Gen X Americans who said the same. The survey considered investable assets excluding the value of homes and retirement accounts.

Over the next 25 years, an estimated $105 trillion in wealth is expected to be transferred in the U.S., with $2.5 trillion projected for 2025 alone, according to Cerulli Associates. However, significant inheritances or gifts remain relatively rare: a Bloomberg analysis revealed that only 20% of U.S. households have received substantial wealth transfers from deceased family members in recent decades.

Generational Perspectives on Wealth Transfer

What may seem like reluctance to give could reflect careful planning.

“Boomers are likely holding onto their assets because of uncertainties tied to aging,” explained Susan Hirshman, director of wealth management at Schwab Wealth Advisory. “As older Boomers approach 80, the fear of becoming a burden to their loved ones becomes more tangible, leading them to retain their wealth for their own security.”

In contrast, younger generations such as Millennials and Gen X prioritize experiences over material possessions as a source of happiness. This preference drives their inclination to share wealth with family during their lifetimes, enabling shared experiences and memories.

On average, Americans with over $1 million in investable assets plan to distribute about 40% of their wealth while alive, amounting to $4.1 million per individual. Much of this transfer—40%—is expected to occur through real estate, followed by investments (31%), cash (18%), and life insurance proceeds (11%).

Wealth with Strings Attached

Interestingly, while Millennials and Gen X are more open to lifetime wealth transfers, they are also more likely to attach conditions. Over 90% of these cohorts include stipulations for recipients, compared to just one-third of Boomers.

“A trust might require beneficiaries to meet certain conditions, such as reaching a specific age, maintaining grades in school, graduating, getting a job, or achieving life milestones like marriage, parenthood, or homeownership,” Hirshman noted.

The survey, conducted online by Logica Research for Schwab, included responses from 1,005 Americans with $1 million or more in investable assets, excluding homes and retirement funds. The survey period was between August 8 and September 2.