The Great Wealth Transfer: What It Means for Gen X and Millennials
The “Great Wealth Transfer,” “Silver Wave”1 or “Silver Tsunami” is upon us. It is the massive transfer of wealth from Baby Boomers (ages 60–77) to their Gen X and Millennial heirs. With Boomers holding an estimated $84 trillion in assets2, including $24 trillion tied to real estate, it’s crucial to understand what this means for those set to inherit.
Are You Ready for Your Inheritance?
Let’s be real—there’s often excitement about the thought of an inheritance, big or small. But many heirs have little insight into what they’ll actually be receiving and potentially managing. Whether your parents transfer assets while living or after they pass, inheriting real estate comes with responsibilities and decisions.
Key Questions to Ask:
- Have your parents shared their estate plans with you?
- Do you know how assets, especially multiple properties, will be distributed?
- Who is the Executor of the estate? If it’s you, do you have access to necessary accounts, key contacts (lawyers, accountants, etc), are you a co-signer on the accounts you need to be?
Real Estate Considerations:
- Will you need to sell the property immediately to cover debts?
- Do you know the maintenance costs—taxes, upkeep, landscaping, etc.? Have funds or will funds be set aside for this?
- If inheriting investment property, do you understand the cash flow, management fees, and tenant turnover process?
- If inheriting a family home, will you sell, live in, or rent it?
- For a portfolio spanning multiple states, do you have an agent or advisor to help with valuation and potential sales?
Starting the Conversation: It’s tricky
Many parents are pretty reluctant to discuss estate plans, offering responses like “None of your business” or “You’ll find out when you need to.” It’s an uncomfortable topic because it forces a conversation about mortality.
But it’s essential and I encourage you to find a way to try and start the conversation. Having experienced an unexpected death in my family, I’ve seen firsthand how managing an estate without prior discussions quickly becomes all encompassing. Even if you can’t get all the details, understanding the basics and having the appropriate contacts is at least a starting point. Hopefully, your efforts open up a meaningful dialogue about life and legacy.
By the way, my success rate with this conversation? One parent has briefed me 100%, the other—well, I at least know the beneficiaries and Executor. It’s a work in progress!
Smart Moves. Bold Moves. Real Estate Moves.
Opinions and views are my own. The content in this post is for informational purposes only. Do not rely on this information for financial and/ or legal advice or to make any decisions about your financial and/or legal situation. Seek professional counsel for your specific needs.