The Great Wealth Transfer: What It Is and What It Means for the Economy

The Great Wealth Transfer is the term used to describe the transfer of trillions of dollars in assets from the Baby Boomer generation to their children and grandchildren. The Baby Boomers are the largest generation in American history, and they have accumulated a great deal of wealth over their lifetimes.

The Great Wealth Transfer is expected to have a significantly lasting impact on the economy and society in the United States. The beneficiaries of the transfer will receive a windfall of wealth that could help them to start businesses, buy homes, and invest in their futures, thereby boosting economic growth. 

The transfer is not evenly distributed. The Baby Boomers are a diverse group, and their wealth is distributed unevenly. The wealthiest Baby Boomers are likely to pass on the most wealth, while the least wealthy Baby Boomers may not pass on any wealth at all.

The transfer is happening now, and it is having an impact on the economy and society.  So, it’s important to understand the Baby boomer’s wealth allocation.

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Based on an article shared by Visual Capitalist – Visualizing $156 Trillion in U.S. Assets, by Generation

In the U.S., for example, baby boomers own half of the nation’s $156 trillion in assets despite making up 21% of the country’s population.

Baby boomers’ biggest category of assets is Equities & Mutual Funds, where they own 56% of the national total. Millennials, on the other hand, represent just 2%.

Assets by Generation

U.S. Wealth by Generation

Source: Visual Capitalist

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In summary, The Great Wealth Transfer is a complex issue with far-reaching implications. It is important to understand the transfer’s dynamics and prepare for its impact.   Based on the data shared by Visual Capitalist, it appears that the Baby boomers are heavy on Equities and Mutual Funds. At the same time, Gen-X and Millennials seem to be getting an earlier start on real estate.  In terms of liabilities, the millennials are more comfortable carrying higher Consumer Credit than any other group.  What will the subsequent generations do as the boomer’s wealth is transferred?  What impact will it have on the total allocation of Equities and Mutual Funds and real estate? Place your bets…