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Or .. Don't Count Your Chickens Before They Are Hatched

Image of billboard with neon sign message - Waiting for your inheritance? Good luck with that!

Intergenerational Wealth Transfer Challenges

Image of bust of Aesop with the quote - Do Not Count Your Chickens Before They Are HatchedIntroduction

There was a time when the offspring of wealthy parents could reasonably expect to be to be the sole or major beneficiaries of their family’s estate. But things are changing.

Let’s first recap on the various generations under discussion here. They are:

The intergenerational wealth transfer dynamics between parents, adult children and grandchildren are only one aspect that is complicating the overly simplistic great wealth transfer theory. For starters, the most obvious factor is longevity itself.

People are living longer. As such, this is creating a situation that could be said to be virtually a “standing-still” outcome for Boomers and their adult children. Still, the good news is that Baby Boomers are likely to live longer than their parents. On the other hand, the not-so-good news, at least for those that are hoping to inherit, as life spans increase, wealth is spent.

Open empty wallet with caption Will Your Family Wealth Last the DistanceUnlike the pre-1945 generation that had pensions providing lifetime income to supplement their savings, fewer than one in four Boomers have a pension to rely upon. Moreover, research shows that nearly 45% of Boomers have no retirement savings at all. Instead, most Baby Boomers are banking on the casino luck of the markets, extended work life, and Centrelink / Social Security benefits to ensure that their life spans don’t outlive their wealth spans. Some may even find that selling their single largest source of wealth (and future inheritance), their home, may be necessary to live with some semblance of comfort in retirement.

Intergenerational Wealth Transfer Challenges

For those with considerably more wealth, many have a different idea from previous generations of what they will pass on, when they die. The pandemic has resulted in a reframing of life for many Boomers – rather than save for life tomorrow, they are choosing to live life today, retire early, and for some folk – to live large and to the fullest that their finances will allow. You may have even heard the expression about them joining the SKIN Club (Spend the Kids’ Inheritance) 😁.

No one ever accused the Boomers of having the frugality of their Great Depression / WWII-hardened parents. A 2021 survey of 1,500 Baby Boomers indicates that a full 75% are less interested in leaving an inheritance and more committed to living well today. Upsizing rather than downsizing, travel, and making memories with their adult children rather than guaranteeing adult children’s mortgages.

Peter Hershon, SVP of Account Services at Coventry, told GOBankingRates that the challenges of COVID-19 put into perspective what is most important to baby boomers. “During the pandemic, seniors were at the highest health risk, more likely to be socially isolated and may have missed out on quality time with loved ones,” he stated. “Looking ahead, boomers are less focused on leaving a financial inheritance for the next generation — and would rather ensure their legacy by making priceless memories with those loved ones today.”

Photo of senior husband and wife enjoying their travel adventureThe survey notes that, hamstrung by the pandemic, Baby Boomers are feeling ready to break out of the house and live large following a year or more unable to travel, see loved ones and cross life experiences off their proverbial bucket lists. Indeed, the survey finds that when this age group was asked about the most important areas of their life to explore and deepen before they die, they prioritised family (41%) and travel (25%). This significantly outpaced learning (10%), hobbies (8%), romantic relationships (6%), philanthropic impact (6%) and careers (4%).

Back to the "Counting Your Chickens" Analogy

So, you’re waiting for your inheritance, hmmm?

Well, you might just be waiting for a long time or perhaps – waiting in vain! Especially if you are part of a (uber)wealthy family!

I expect that you have heard of the likes of Warren Buffett (Net Worth – $AUD180Bn), Bill Gates (Net Worth – $AUD170Bn), Mark Zuckerberg (Net Worth – $AUD168Bn) and Mick Jagger (Net Worth – $AUD816Mill.). Yes?

Well all of these wealthy men have one thing in common. That is, they are planning to NOT pass on the bulk of their estates to their children. Instead, their wealth is going into trusts, some charitable, as well as philanthropic Foundations.

The common thread here seems to be that they don’t want their heirs to be set up for a cushy life ahead. Rather, they will be encouraged to make their own successes.

This trend, by the way, isn’t restricted to the mega-wealthy alone. We are seeing more and more self-sustaining, moderately wealthy and HNWI’s adopting similar stances. In saying this, there is still a substantial number of wealthy families / family offices working on the premise of preserving their family dynasty.

If you are a potential heir to the family fortune, or not, either way it will pay you to becoming as financially literate as possible. This way, you’ll be well-equipped to make your own successes without relying on your inheritance. Additionally, should you be placed in the position of carrying on the family dynasty tradition, your financial literacy prowess will be invaluable to you.


The “Intergenerational Wealth Transfer” story is far more complex than it used to be. The reality is that Boomers have lots of money, Boomers will die soon, Millennials (and some Gen X and Millennials) will inherit money to buy big, invest big, etc. That might have been true if all Boomers had money, reflected the same values as their Builder (silent generation) parents, enjoyed relatively uncomplicated family dynamics, and were unlikely to live longer than previous generations.

However, our advice to you is that it will pay you to learn how to make your own way – because you may end up not having a choice to do otherwise.

How FBA Can Help You With Your Own Success Strategies

At Family Business Advisory (FBA), our purpose is to help family businesses succeed on a sustainable basis. As such, we provide you with access to specialist family, business and technical services with a goal being to generate opportunities for families in business.

In order to complement our own particular specialised skills, over the past several decades, we have developed a network of trusted, professional advisers in such areas as:

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Moreover, we work at all times to give you peace of mind and proactive support to help navigate any changes in the market brought about by legislative changes, geopolitical events and general market conditions – all to maximise your personal wealth and security.

These services are provided by FBA, in association with the Wealth IQ Group.

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