The Generational Shift In Wealth From Baby Boomers To Millennials

A huge shift in wealth is occurring… and it impacts us all  

A monumental shift is happening.

Yeah, I’m telling you, it is huge!

It is going to lead to much more responsibility for a huge group of individuals.  But it should be one that pays off handsomely.

Are you a big fan of teasers?

Me?  Not so much.  I like to figure out the point or where someone is going with a story and move on.  The anticipation can be frustrating.

On the other hand, though, they can be really fun.  It leaves us something to look forward to.  It gives us a reason to work hard to get to the next stage or moment of our lives.

Does it change your feelings if you actually know what is at the end of the tunnel?  And all you have to do is wait?

It’s just a different type of teasers.  You have those that leave you guessing and then you have those that tell you everything, but just make you wait.

That’s when patience comes into play.  But the ones when you know what’s at the end of the tunnel allow for you to make necessary adjustments.

I’m a bigger fan of those teasers.  It takes some of the unknown out of the equation.  Unknowns always make things a lot more complicated!

Oh, yeah.  About that teaser I was mentioning before. Yeah, it is going to be huge.  Really game changing.

That shift I am talking about is a generational wealth shift.  The Baby Boomers are retiring, and they are doing so with TONS of moolah.

This isn’t one of those “oh what is going to happen” teasers.  It’s the “holy shit how do I prepare for this” type.

So, let’s answer that.  Come along for the ride.


What’s about to happen could be big… really big

So here is the scenario.

It looks as if the Baby Boomer generation is going to be shifting (passing onto heirs) about $30 trillion.  Yes, that is trillion with a “T.”

All that is looking to be passed along in some fashion.  But before you start moving into that new mansion, let’s look at history for a quick second.

The Boomers were expecting to reap about $41 trillion in assets.  However, given the flat market over about 10 years now they have only received about $11.6 trillion in assets.  That’s nothing, right?!

So, we can’t start counting our chickens as part of the younger generations.  Many of the Boomers are likely to utilize the funds while they are living.  To improve quality of life, enjoy grandkids and great grandkids—while also looking to give some money to charity.

Clearly it would be foolish for us to sit here and rely on the possibility of this money trickling down to us.  We have to make our own wealth, and make our own name for ourselves.

How I think about it (and “psh” me if you want) is that my parents provided me an ability to educate myself and taught me values and life lessons.  It’s up to me to enhance those skills to make my own wealth.  While it’s their duty to spend their hard earned money.

If they leave me anything, great!  But, if not, no hard feelings.  It was their money in the first place.  They spend and have spent enough on me already.



Preparation is necessary despite the unknown of what we may get

For us to be sure that whatever wealth is transferred to us will be put to good use, we have to start today.  Not when the moment occurs.

What does that mean?

It’s time to educate ourselves on personal finances.

Yeah, personal finance can be boring as shit (unless you’re reading or listening to anything on our blog, of course).  If we ever come into money, though, we need to know what to do with it.  If we wait until the moment we’re suddenly handed a large amount of money to figure it out, we will be doing a disservice to ourselves and to those who left the money to us.

Education is the biggest key.  We not only have to understand some aspects of personal finance, we have to understand our own situation.

This doesn’t mean that we have to become financial experts.  We have to learn how we want to consume financial information.  Along with whether we will want to go through this endeavor alone or with someone else.

If you don’t want to go through it alone, then how should we choose and utilize a partner?

Given the advancements in technology, the way that we consume educational materials or interact with those who can help is changing.  It’s time for us to rid the notion that we have to deal with our financial situation in the same manner as our parents.

The next most important thing is that we must begin to take action today.  We must learn about the ways to both consume this information and the options we can utilize to interact with those we want to partner with.

The reason that this is so key is that we don’t want to get to the day the wealth comes along and not have a plan.

Ah, a plan.  That may make your eyes roll.  It’s not a plan that has to be boring.  It’s a plan that you have to be comfortable with when that day comes.  Because if you don’t have a plan, then being taken advantage of is much more likely.

Think about my car blog a while back.  If we walk into a car dealership without a plan, we are likely going to get taken advantage of by the car salespeople.  Maybe not necessarily taken advantage of, but maybe pushed towards a decision less than desirable for us.

Begin educating yourself today and crafting parts of your plan.  It doesn’t have to be complete, but begin today.


The $30 trillion light switch

For those that are still rolling your eyes but are kind enough to still be reading, I’ll provide an example of what I mean.

If you were told today to go and run 10 miles, right now, what would you do?

Personally, I would look at you and tell you to get the heck away from me… because it ain’t happening.

Now there may be a small segment of people who feel that it will be easy breezy.  But I would have to think that the majority of us aren’t ready to do that right now.

Now if that person instead said, “Let’s build up to running 10 miles, and start by running around the block.”

If you had to run 10 miles, you’d probably prefer to build up to it rather than be forced to just do it. You have to build the endurance, get back in shape and do it in small strides.

That’s what I am suggesting we do in regard to the generational shift because the day that it occurs is like someone telling you that you have to run 10 miles before you can do anything else.

This is a difficult task.  Those who are able to run the 10 miles right away are equivalent to the people who already inhibit solid financial habits.

Of course, we can all sit here today and say we know that we will take action then.  We will begin to educate ourselves then… but come on, isn’t that a little late? Planning that once we have a sudden windfall of money will be the point we find a partner is like walking into a car dealership not knowing what we want or even if we want to buy a car.

So, start prepping for this 10 mile run… because you are in this to win it.  It is a once in a lifetime opportunity, so we surely want to deal with it the best way we possibly can.


Get to work; it’s what’s in the best interest of us all

Yeah, we may not receive the entire $30 trillion into our generation.  We are about to be the heirs to a large chunk of change, though.

The beauty of it is that we can utilize it to create a solid financial foundation for us and our heirs.  This is a pivotal moment in history.

If we don’t manage this shift well, then we are putting all the future generations at risk.  The Baby Boomers were the largest generation.  Now the Millennials have taken that title.  If we mess up this generational transfer of wealth it puts everyone else at risk.

Begin by getting your financial situation in order today.  Get a partner or educate yourself enough to where you are putting your education to work now.  This way nothing will have to change once the shift occurs except perhaps a little less pressure on your budget.

If you are preparing by living a financially sound life now, you won’t be pushed off path even if the generational shift doesn’t occur.

Don’t wait for others to choose your fate, create your own.