Gen Z Will Have To Wait As Gen X Set To Inherit Trillions From Silent Generation

A new report from consumer research firm Hearts & Wallets reveals that Generation X stands to inherit trillions of dollars from the Silent Generation over the next 10 years, presenting significant opportunities and challenges for financial advisors.

Currently, the 65-74 age group holds the highest wealth at $22.4 trillion. In a decade, an estimated 23 million households will be 75 or older, with another 5.6 million reaching 85+. The nearly 16 million people aged 75+ today control about $15.5 trillion in assets, according to InvestmentNews.

Laura Varas, CEO of Hearts & Wallets, emphasizes that this wealth transfer primarily involves the Silent Generation and Gen X, not Boomers and Millennials. She notes that inheritances, even modest ones, often prompt recipients to focus on their own financial planning.

The study found that those inheriting $500,000 or more are generally financially savvy, with 35% having taxable brokerage accounts and 60% considering themselves somewhat familiar with investing. These individuals are often open to advice, but may have already dismissed unsatisfactory financial service providers.

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Varas highlights the complexities of handling estates, drawing from personal experience. She stresses the need for improved advice and service in this area, citing instances of misguided recommendations and poor communication she encountered while managing family estates.

Financial advisors have significant opportunities to assist with inheritance and wealth transfers. The report shows that among U.S. households receiving inheritances, over half are under $100,000, 30% are between $100,000 and $500,000, and 14% are higher.

Advisors working with older clients are encouraged to build relationships with younger family members. While Gen Xers may have existing financial relationships, they might be open to working with their parents’ advisors if the service is exceptional. Varas notes that people now typically work with 8-13 financial services providers, up from 1-3 in the past.

As this massive wealth transfer unfolds, financial advisors who can navigate the complexities of estate planning and provide superior service stand to benefit from this generational shift in assets.

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