The future of inheritance is being redefined—and it looks very different across generations.
A recent survey by Charles Schwab shows a shift is taking place among wealthy Americans with younger generations more eager to pass on their wealth while they're still alive.
The financial services firm surveyed more than 1,000 high net worth Americans.
While Boomers are traditionally focused on preserving wealth to pass along to their children after they pass, Millennials and Gen Xers are twice as likely to want to share their fortunes during their lifetimes.
Wealth Transfer: A Generational Shift
The Schwab survey reveals that 97% of wealthy Americans plan to transfer their assets.
Among wealthy Millennials and Gen Xers, 53% and 44%, respectively, prefer to share their wealth during their lifetimes while just 21% of Boomers feel that way.
Not only are younger generations eager to distribute wealth earlier, but they are also far more likely to include specific stipulations in their plans. These younger wealth holders are setting conditions on how their inheritance should be used—an approach almost unheard of among Boomers.
The Push for Proactive Planning
About 61% of wealthy Americans who intend to pass on wealth began their planning before age 45, with most (56%) starting when their net worth hit $1 million or more.
However, only a smaller percentage of Boomers—those who are often approaching retirement age—have taken similar steps, underscoring the generational gap in proactive wealth management.
Moreover, younger Americans plan to pass on a larger portion of their wealth during their lifetimes.
Millennials, for example, expect to distribute an average of 52% of their assets while alive, while Boomers anticipate giving away just 19% before passing.
This shift is being driven not only by a desire to see the impact of their wealth but also by the belief that giving early can provide financial support and strengthen family bonds.
It's not just the timing that's changing—how wealth is distributed is evolving too. Younger wealthy Americans are significantly more likely to impose conditions on their wealth transfer. For instance, 43% of Millennials and 41% of Gen Xers are specifying how their money can be spent, while just 7% of Boomers have similar restrictions.
These stipulations may include requirements for reaching certain life milestones or maintaining academic or career performance to access funds. Younger generations are also more likely to tie wealth distribution to charitable giving, ensuring that their wealth benefits not only their families but also the greater community.
