Much press has been devoted to the “trillions” of dollars in assets that boomers stand to inherit in the coming years. Yet, according to a new report, many adult children, boomers among them, haven’t spoken with their parents about the disposition of estate assets. And a key reason is inertia.
Now in its 6th year, the 2006 Across Generations survey was released by New MainStay Investments, a Parsippany, N.J.-based retail arm of New York Life Investment Management. The study polled 1,512 individuals between the ages of 27 and 83 to measure the differences in investment attitudes and behaviors among generations. These included 4 age groups: GenXers (1965-1979); late baby boomers (1956-1964); early boomers (1946-1955) and seniors (1923-1945).
“The primary goal of [the research] was to discover how financial advisors can better understand the issues most important to their high net-worth clientele,” says MainStay Investments President Chris Blunt. “We wanted to learn about the attributes that help and hurt advisors with clients and what advisors can pro-actively do to put them in the best position to succeed.”
Respondents had at least $250,000 in investable assets. The analysis was broken down by generational cohorts and subdivided by gender. The research had a confidence level of 95%.
Thirty-two percent of married respondents reported they don’t have a last will and testament to help with estate planning and asset transfer, and 39% of married late boomers (average age 46) have no will. The figure among GenX married couples was still higher: 50%.
Seventy-two percent of parents said they would encourage their financial advisor to discuss wealth transfer and estate planning issues with their children. By comparison, 50% of adult children would ask their financial advisor to do the same with their parents. Eighty-nine percent of high net worth respondents said that a financial advisor would be important to manage the assets for the surviving spouse.
The report noted a widely held perception among respondents that emotion and anxiety related to conversations about wealth transfer and estate planning has led to poor communications–if any at all–concerning the whereabouts of assets and other critical documents. In fact, these conversations had not taken place due to inertia among family members. “Haven’t gotten around to it” was the number one reason given by both parents (52%) and adult children (41%) for not talking about the location of assets.