Inheritance and Wealth Transfer to Baby BoomersPosted by in Estate Law
The figures, drawn from national survey data, say the wealthiest Boomers will be given anaverage of $1.5 million, while those at the other end of the spectrum will be left $27,000, anamount that represents a larger percentage of the latter group’s overall wealth. Two-thirds of allBoomers stand to receive some inheritance over their lifetimes.
- Most Boomers will receive their inheritances in late middle age, upon the death of thesurviving parent. To date, the overwhelming majority of inheritances are passed fromparents to children (63% of inheritances and 74% of dollars); grandparents are the secondmost common source.
- Although only 17% of Boomers had received an inheritance by 2007, two-thirds willeventually receive one.
- Considering only past inheritances, the median amount Boomers received by 2007—adjusted for inflation—is about the same as that received by the preceding 1927–1945 birth cohort at the same ages.
Data were analyzed from the Survey of Consumer Finances (SCF), a triennial survey thatoversamples wealthy households. SCF participants were asked about past receipts of inheritancesand of inter-vivos gifts (those given during the donor’s lifetime). They were also asked whetherthey expect a substantial inheritance or transfer of assets in the future and the anticipatedamount. For data on prospective inheritance receipts, the study relied on the 2006 Health andRetirement Study (HRS), a nationally representative panel of individuals born before 1954 andtheir spouses of any age. In 2006, individuals were asked to estimate the probability of receivingan inheritance in the next 10 years and the likely amount. The authors converted these 10-yearforecasts into lifetime probabilities and assigned probabilities and amounts to SCF householdsborn 1946–1964 to obtain a complete picture of past and prospective inheritance receipts for theBoomers.