Baby Boomer couple, closeup side view, enjoying a sailing cruise during their summer vacation at ... More
You would like to believe that your wonderful Baby Boomer parents would live their lives financially conservatively. Then, after decades of earnings, they’d have a substantial fortune to pass onto their children. Unfortunately, many young adult children are going to be greatly disappointed. The older generation, considered as staunch wealth preservers, are deciding to enjoy their wealth now rather than simply passing it on. This large cohort are prioritizing experiences such as travel over saving for their heirs.
The “Great Wealth Transfer” is sort of underway. It’s playing out differently than many people, especially adult children of Boomers, thought would happen. Boomers are rewriting the rules of wealth management in retirement. Rather than simply hoarding assets for their children, many are embracing a more unexpected plan. They are spending to enhance their own lives today while still preparing to pass on some or meaningful wealth over time.
Many Boomers subscribe to the “Die with Zero” philosophy, according to MoneyWise. A 2024 Northwestern Mutual survey shows that around only 22% of baby boomers will leave an inheritance to the children. This growing mindset encourages spending down assets during retirement, rather than preserving large estates. According to Charles Schwab study, high net worth U.S. boomers say they would prefer to use their money on themselves rather than share it with their kids now or leave behind an inheritance when they die.
Why Boomers Are Holding Onto Their Wealth
Although the responses of Boomers may seem harsh, they have some validity. There are practical reasons for Boomers to hold on tight to their money. Rising healthcare costs is a big concern. A 65-year-old may spend over $165,000 on healthcare during retirement, with long-term care costs reaching upwards of $64,000 annually, according to Fidelity, a large financial institution.
Stubbornly high inflation and living expenses could force many Boomers to dip into savings for daily expenses, reducing amounts available for inheritance. There is a fear of outliving their savings. With lifespans stretching into the 80s and 90s, many fear they will outlive their savings.
A recent survey published by the Transamerica Center for Retirement Studies® indicates that the retirement outlook for Generation Z, Millennials, Generation X, and Baby Boomers shows that 41 percent of workers think that future generations of retirees will be worse off than those currently in retirement.
The survey found 70% of working Boomers plan to rely on Social Security, but median savings of $194,000 fall far short of the $1.22 million needed for a 30-year retirement, assuming $48,885 in annual spending.
The recent stock market plunge and chaos could be a catalyst for their decision making. Those who have large investment portfolios may suddenly turn fiscally responsible to hold onto their wealth. Finance professor Peter Ricchiuti warned that Boomers, heavily exposed to equities, could face “devastating” losses.
However, if Boomers have a change of heart, and choose to pass down their fortune, it would create an enormous transfer of wealth. Cerulli Associates estimates $84.4 trillion will transfer through 2045, with $72.6 trillion going to heirs, primarily Gen X and Millennials.
The Wealth Of Boomers
Baby Boomers control a large share of America’s wealth. As of Q1 2025, their net worth totals approximately $78.5 trillion, roughly 52% of the nation’s household riches, according to Federal Reserve data. This includes $23 trillion in corporate stocks and mutual funds, $18.9 trillion in real estate, and significant holdings in pensions, private businesses, and other assets. Their wealth surged over decades, fueled by a 40-year rally in stocks and housing, low interest rates, and strong economic growth post-World War II.
Boomer households have half of the nation’s wealth. This generation has accumulated an average net worth of $1,652,385, according to Empower Personal DashboardTM August data. But not all Boomers are flush. Median retirement savings are just $194,000, and 26% have less than $50,000 saved. Healthcare costs, longer lifespans, and market swings threaten to erode these nest eggs.