The “great wealth transfer,” during which some $105 trillion is expected to be passed down to younger generations by 2048, is already underway for many older women, according to a recently released study from J.P. Morgan Wealth Management.
Sixty-three percent of women in their early 60s and older have already received an inheritance. Forty-five percent of these inheritors said they have used their new wealth to invest.
Other women said they are paying off debt, traveling, supporting friends or family and donating to charity. Asked what they would do with a future inheritance, 68% said they would travel.
The study was conducted online in English and Spanish from July 30 to Aug. 13 among a sample of 1,045 Americans 25 and older with at least $25,000 in investable assets.
The study found that women are also working to build wealth on their own. Seventy-three percent said having money gives them security, while 64% of Generation Z and millennial women said it gives them freedom and choices.
Of the women in the study who are expecting to receive an inheritance, 93% said they would not depend on that money to reach their financial goals. Overall, three-quarters of women expressed confidence in their ability to achieve these goals.
Money Conversations in Relationships
J.P. Morgan Wealth Management’s study found that money is a taboo topic when it comes to dating, but that that is starting to change among younger investors.
Overall, only 20% of both male and female investors surveyed said they would talk about money on a first date, plummeting to 7% for baby boomers. But among Gen Z and millennial respondents, 35% said they would talk about personal finances on a first date.
The survey identified similar trends among female respondents. A majority of Gen Z and millennial women said that money should be talked about within the first nine dates, while female boomers believed that conversations about money should be saved until the 10th date or later.
Regardless of when the conversations occur, 68% of all investors reported that they have financial dealbreakers when it comes to dating. But 86% said they had dealmakers — traits or qualities that would draw them to a prospective partner:
- Financial independence or self-sufficiency — 61%
- Good budgeting skills — 55%
- Strong knowledge of personal finance — 34%
- Monetary investments — 31%
Sixty percent of both male and female respondents who were already coupled said they have the same or similar relationship with money as their spouse or partner. A similar number reported that they are comfortable relying on a partner for financial support.
Among female respondents, 75% said they either make financial decisions together with their partner or take the lead themselves.
Financial Wellness Influences Mental Health
A financial plan can have a major effect on financial outcomes and overall health, according to the investor study.
Overall, 62% of respondents said their financial situation affects their mental health, a figure that rises to 71% for Gen Z and millennial investors. In addition, half of investors said their finances affect their physical well-being.
The survey found that having a financial plan is the most popular strategy to reduce financial stress and support overall health and wellness, as reported by 50% of respondents. It is even more popular than building savings for potential health emergencies and increasing income.
Among respondents with a plan, 90% expressed confidence in their ability to meet financial goals, compared with 49% of those without a plan. Similarly, 86% with a plan said they are on track to meet their retirement goals, versus 47% without a plan.
Likewise for being on track to meet 2025 financial resolutions: 69% with a plan, 25% without; and not being stressed about their financial situation: 80% versus 64%.
Negotiating Market Volatility
Despite continued market volatility, investors surveyed by J.P. Morgan Wealth Management appear not to be sweating the ups and downs, with three-quarters of respondents agreeing that volatility is a normal part of investing.
When the market declines, 64% said they would not take any action with their investments, compared to 28% who would take the opportunity to buy the dip.
Still, investors have concerns about the economy, with 75% concerned about inflation and 60% reporting that interest rates have influenced their financial decisions this year.
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