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Portfolio > Alternative Investments > Real Estate

Schwab: 25% Of Affluent Older Americans Lack Estate Plans

By Marcella De Simone

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NU Online News Service, July 24, 2003, 5:27 p.m. EDT – One-quarter of affluent U.S. adults over age 45 have not made any plans for their estates, according to survey results released by Charles Schwab Corp., San Francisco.

Researchers from Harris Interactive Inc., Rochester, N.Y., reached 1,102 affluent U.S. adults for Schwab through the Web in June. All participants were over age 45, and all had annual household incomes over $100,000 or at least $500,000 in household net worth.

The average participant had a net worth of $1.7 million.

Only 50% of the participants agreed that “people should strive to leave an inheritance to their children/beneficiaries,” and only 10% said they were very or extremely likely to leave any part of their estates to charity. Fifty-six percent said they were not at all likely to leave any part of their estates to charity.

Older participants were more likely than younger participants to be interested in leaving legacies for children, the researchers found.

More than two-thirds of the participants who rejected the idea of leaving money to charity said they simply wanted to leave their estates to their children and other beneficiaries instead. But 21% of the participants who rejected the idea of charitable bequests said they didn’t trust charities to spend the money well.

Eighty-eight percent of the participants were aware of the federal gift tax provision, which allows a person to give up to $11,000 per year to any recipient, but only 32% of those who are aware of the provision had taken advantage of it, researchers found.

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