The Greatest Generation appears to be leaving less to their Baby Boomer children than expected, according to a Dow Jones report. While Boomers were expected to inherit roughly $10 trillion, experts have ratcheted those estimates down by about 80% to $2.1 trillion. For those between the ages of 42 and 60, this could mean more emphasis on saving, and growing, their money now, rather than expecting supplemental help later. Besides the apparent reduction in wealth, Boomers are also expected to live longer than their parents. For example, women who are now 50 will likely live to 81.8, while men of the same age, on average, are expected to reach 79.9. Although those are medians, some financial planners are urging clients to plan as though they will live to 100. Evaporating inheritance pools also mean later retirements. For someone earning $100,000 before taxes who wants to maintain his or her lifestyle in retirement, it will take $2 million in savings, according to experts. That means Boomers who are closer to retirement than they are to collecting $2 million in savings, may need to focus on more aggressive, income-bearing investments in retirement. Furthermore, Boomers, more so than prior generations, are also more likely to be supporting their children’s educations, or help cover the cost of their own parents’ health care. In a recent statement, the American Association of Retired Persons said, “Inheritances, despite wishful thinking and optimistic projections, are not likely to bail out the Boomers.” The staff of Money Management Executive ("MME") has prepared these capsule summaries based on reports published by the news sources to which they are attributed. Those news sources are not associated with MME, and have not prepared, sponsored, endorsed, or approved these summaries.
