“I’m spending my children’s inheritance.” – from a bumper sticker seen on the back of an RV.
If last month’s “Tell Me More” U.S. Trust “Insights on Wealth and Worth survey,” is to be believed, everything Queenan presciently wrote about the ‘Selfish Generation’ is reinforced by its findings: “Fifty-one percent of millionaire Baby Boomers do not think it’s important to leave money to their children.”
So much, I guess, for all those estate planning lawyers and their clever stratagems so the rich can transfer as much tax-free wealth as possible to their eagerly waiting scions. They’re planning instead on taking it with them.
Supporting such sentiments is the handy acronym for spending down junior’s inheritance, SKI’ing – Spending the Kid’s Inheritance. See “50Plus : Money : Spending the kids’ inheritance (guilt-free).” The word “guilt-free” may be superfluous.
According to the survey, Boomers are “very much focused on their own happiness and their own fulfillment” – – – not on bequests and legacies. And how is that any different from the self-centeredness of their youth? See “Inheritance Denied For Some Baby Boomers’ Kids.”
Notwithstanding the survey results, though, there’s another reality that more plausibly explains why most Boomers won’t be leaving legacies. It’s not because they’re bloody rich. It’s because they’re broke. The home equity’s gone. And after having spent every sou they ever had, they’ll be reduced to eating cat food at the end. See “Baby Boomers Are Not Saving Enough for Retirement” and that “3 Out Of 5 Baby Boomers Don’t Have Enough For Retirement.”
So instead of testamentary treasure, some hard-pressed Boomers may end up leaving heirs empty tins of cat food.
Such sad futures, however, hardly give the “Me generation” a pass since it just means that those ever-materialistic Boomers spent it all to “Die Broke.” See “Baby boomer empty-nesters boost spending, not saving.”
But as for those other lucky bastards with enough money to be deemed wealthy, well, those Boomers will be spending their hard-earned moolah on themselves.
That’s an attitude considerably at odds, for example, with that of Yu Pengnian, the Chinese billionaire real estate tycoon who last year gave away his fortune to charity – – – leaving nothing for his kids. Yu declared, “If my children are competent, they don’t need my money. If they’re not, leaving them a lot of money is only doing them harm.”
Yu has given away over $1 billion to various philanthropic causes. In April 2010, he donated his final $500 million to a charitable foundation he created.
But then Yu’s generosity should be unsurprising. At 88 years of age, Yu’s no Baby Boomer. And that, of course, explains everything. See “If Your Children Are Competent, They Don’t Need an Inheritance.”