Fewer Americans may be in store to inherit their parents' wealth. A rising number of baby boomers feel that by the time they die they will have done enough for their children. Others may just have little or nothing left to give, the LA Times reports.
According to the newspaper, a survey of millionaire baby boomers, conducted by investment firm U.S. Trust, found that only 49 percent said it was important to leave money to their children when they die.
The baby boomers are beginning to focus on the sacrifices they have already made. After spending their lives working, building businesses and preparing the foundation for their children's lives, many aging Americans express a desire to enjoy their money.
A poll reported in the Washington Post “found that nearly 60 percent of parents are giving, or have in the past granted, financial support to their adult children who are no longer in college.”
The baby boomers have financed surging educational costs, helped with down payments on homes, and supported efforts to launch their children's careers. With the economic conditions as they are, some parents are still providing financial support for daily living expenses.
Many boomers already are giving the equivalent of an inheritance, except they're doling out the cash while they're still alive, said Ken Dychtwald, chief executive of research firm Age Wave in the LA Times.
A growing portion of the aging population also notes that if they leave money behind, there is a significant chance that their children will blow it.
One-quarter of boomers worry that their children will become lazy and 1 in 5 fear that the kids will squander the money, according to the U.S. Trust survey, the LA Times says.
Instead of allowing that to happen, some baby boomers are coming to the conclusion that they can enjoy their hard earned money themselves.
However, the changing view toward inheritance is not always driven by a desire to live it up during the golden years.
As the Washington Post article points out, “parents are tapping their savings cushion, taking on debt, delaying their retirement or not saving for their retirement because they can’t cut the financial ties to their grown children.”
The economic downturn has affected baby boomers like everyone else.
Their wealth was not immune to the massive losses that came with the recession. With Americans living longer than they used to and the costs of living and healthcare rising, there is growing concern that some baby boomers may outlive their saved financial resources. Supporting grown children is an additional cost that many don't need and may not be able to afford.
The Financial Advisor says that faced with miniscule rates on money market funds, many retirees who worked and saved hard are forced to consider riskier investments if they want to produce sufficient income.
The Financial Advisor also says “survey after survey shows that many boomers want to remain working in their golden years.”
Many who do leave the workforce do so too soon as is shown by the wave of retirees who have found it necessary to return to work.
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