I have seen all kinds of estimates for the coming power transfer from baby boomers to the next generation.
$ 16 trillion. $ 84 trillion. $ 124 trillion.
I think those figures depend on a whole series of assumptions, that’s why they are everywhere on the map.
Whatever the actual number is in the future, at the moment the baby orbiting generation is worth more than $ 82 trillion:
Part of that money will be spent, but much of it will be passed on.
There are countless talk points about the great wealth transfer.
How does it affect the housing market? Will baby boomers now give something away from their money to the younger generation? What does it mean for the stock market? What are the tax implications? How will it be the inequality of wealth?
Here is the only part of this conversation that we don’t really touch on – the great wealth transfer requires that the baby orbiting generation dies. Death and taxes, right?
These are the parents of people, grandparents, aunts, uncles and friends.
When that money goes, it is not just a line item on a spreadsheet. There is also an emotional component. The money, houses and other items that are passed on have meaning.
Ozzy Osbourne and Hulk Hogan died in the past month. They were both in the 70s.
It is morbid to think about, but with 70+ million baby boomers there will be many people in the years prior to people you know personally or know in a different capacity. The median age of baby boomers is about 70 years old.1
This year I thought a lot about death after my brother Jon died. It forced my family to have many difficult and uncomfortable conversations.
Many families will be forced in the coming years in the coming years.
Financial advisers often play a role in the money side of the comparison when someone also dies.
There are a lot of paperwork and decisions that must be made. That process becomes much more challenging if things are not arranged in advance.
I have heard horror stories from financial advisers who try to take advantage of people after a family member has died. I have also seen firsthand how helpful a good financial adviser can be for someone who is dealing with the loss of a loved one by taking financial decisions and tasks easier.
That requires a number of uncomfortable conversations, so everyone is on the same page.
Carl Richards has always been one of my favorite voices when it comes to simplifying the financial planning process. He is also a master to let people talk about the important things.
I was not going to get too deep in the subject of death and money, but Carl left me open.
We talked about how you can also have uncomfortable conversations with your financial adviser or loved ones:
We have also had the biggest concerns about the biggest concerns that financial advisers currently have, the shrinking behavioral gap, the creation of authentic content, how you can spend your money correctly, Carl’s biggest money error and more.
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1The baby boom generation is usually defined as born between 1946 and 1964.
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