The Great Wealth Transfer

April 15th 2014, by Charles D. Keller

In the late 1990s a small group of Boston College researchers wrote a paper projecting an enormous transfer of wealth via inheritance. They estimated that over 40 trillion dollars would change hands to an inheriting generation within the first 50 years of the current decade. This theory became known as “The Great Wealth Transfer.” Since their writing, other experts have given varying opinions as to the overall amount of projected inheritance. The amounts have ranged from 10-20 trillion, on the low side, to over a 100 trillion on the high side. Regardless of the widely varied amounts, that is a lot of money changing hands to the next generation within a 50-year period of time.

It reminds me of a different kind of transfer I’m going to call The Great Wisdom Transfer. Quite a few years ago, Lyle and I were in Kansas City meeting with Ron Blue and some other financial advisors from around the country. Ron was teaching a concept he called “passing on wisdom before passing on wealth.” He used Ecclesiastes 7:11-12* as one of several Biblical references. What a phenomenal challenge for all of us to consider. The opportunity to teach, model, and encourage good stewardship to our children and grandchildren is a high privilege and too precious to waste. Imaging the satisfaction and confidence of planning for the future distribution of your estate, knowing that your stewardship values have already been passed on to your family. This takes time and intentionality.  It won’t just happen. As a father of 3 fine young adult children and “Pop-Pop” to 2 awesome grandkids, this transfer of wisdom principle really gets my attention. Will you join me on this quest? Let’s make sure we pass on wisdom before we pass on wealth to the next generation. Our families will be blessed and will be a greater blessing to the world around them.

*Wisdom along with an inheritance is good and an advantage to those who see the sun. For wisdom is protection just as money is protection. But the advantage of knowledge is that wisdom preserves the lives of its possessors. (Ecclesiastes 7:11-12, NAS)

Source: “Millionaires and the Millennium: New Estimates of the Forthcoming Wealth Transfer and the Prospects for Golden Age of Philanthropy” by John J. Havens and Paul G. Schervish, October 19, 1999.