A recent RBC Wealth Management survey reveals key factors and unique insights for a successful wealth transfer.
According to a report by Cerulli Associates, an estimated $124 trillion is set to change hands to heirs and charities by 2048, including $54 trillion to widowed spouses.* However, most of the wealth will flow from baby boomer parents (Givers) to their Gen X and millennial children (Receivers).
In 2024, RBC Wealth Management–U.S. surveyed 1,500 people with at least $1 million in investable assets to explore what’s important to each generation—both Givers and Receivers—and how this may impact wealth transfer planning.
The great wealth transfer is underway, with each Gen Xer and millennial expected to inherit an average of $1.7 million and $2.4 million*, respectively. We want to ensure you feel confident about your estate plans, your family’s financial security and the legacy you leave behind.
* The Cerulli Report: High-Net-Worth and Ultra-High-Net-Worth Markets 2024: The Great Wealth Transfer: Capturing Money in Motion
Learn more about factors and trends influencing generational wealth transfer and discover additional insights from RBC Wealth Management to better navigate your role as a Giver or Receiver.
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At RBC Wealth Management, we understand that wealth transfer is about more than money. It’s about your family legacy and aligning your priorities, passions and values with the next generation.
Unsure about where to start? Discover how your thoughts compare with other Givers (baby boomers) and Receivers (Gen Xers and millennials).
In our survey, every generation agreed (over 90 percent) that their family values are the foundation of their financial values. Yet having your family values resonate with the next generation requires intention and time. Perhaps that’s why just 52 percent of Givers have discussed their values with their intended beneficiaries.
Givers who have had conversations about their values with intended beneficiaries are much more likely to feel very prepared to leave an inheritance (71 percent compared to 51 percent of all Givers).
Have you thought about your family’s values and how to ensure they carry on?
Our survey revealed that family harmony is one of the most important aspects of family legacy across all generations (54 percent of baby boomers, 46 percent of Gen Xers and 53 percent of millennials). However, harmony is only possible when everyone understands their role in the wealth-transfer process.
Eighty-three percent of Givers don’t believe their heirs are informed and prepared about the wealth they will be inheriting, yet 61 percent have not provided guidance or direction to their beneficiaries. On the other hand, only 54 percent of Receivers feel very prepared to receive an inheritance. Despite these findings, 89 percent of Gen Xers and 82 percent of millennials indicated that receiving an inheritance would allow them to start thinking about their own legacy.
How prepared are you as a Giver or Receiver?
The majority (84 percent) of surveyed Givers agreed that ensuring their family is financially secure for generations is a top priority. However, 75 percent of Givers also want to enjoy life now, even if it means passing on less to their heirs.
Ninety-four percent of Receivers indicated they would treat the money they inherit differently than what they earn, and 93 percent don’t anticipate spending their inheritance but investing it. Giving while living allows you to witness the impact of your wealth. Your RBC Wealth Management financial advisor can help you create or review your retirement income plan to determine when and how much you can give.
How will giving now affect your future?
All generations of survey respondents agreed that it’s important to talk about an inheritance with those who will receive it (89 percent of baby boomers, 98 percent of Gen Xers and 97 percent of millennials).
Despite this, only 39 percent of Givers have provided guidelines or direction to their beneficiaries. The time to have the family inheritance discussion is now, not when the heirlooms and assets are passed down. Ninety-nine percent of all Receivers indicated they want to respect the wishes of those leaving them an inheritance.
Sharing your thoughts with each other now helps your heirs better understand your wishes and not feel paralyzed by their newfound wealth.
Have you and your beneficiaries had a real conversation about what’s to come?
According to our survey, financial advisors are the primary resource high-net-worth individuals would consult to learn more about inheritances: 78 percent for baby boomers, 71 percent for Gen Xers and 67 percent for millennials.
Think beyond investment strategies and tax minimization. Your RBC Wealth Management financial advisor can help you live for today, plan for tomorrow and navigate conversations with your loved ones to ensure your legacy and family values continue.
Is your wealth transfer plan ready?
Our RBC WealthPlan interactive technology, including RBC Retirement Paycheck, helps you and your financial advisor visualize and prepare for your retirement and wealth transfer, no matter when you plan to give to heirs or causes.
Get started on your wealth transfer planning with guidance from your RBC Wealth Management financial advisor.
Taking the time to prepare the next generation can help make sure they have a concrete understanding of the values underpinning your family wealth goals.
Lifetime gifting can be a useful wealth transfer strategy to mitigate taxes and help heirs.
The path to a successful inheritance requires planning and education between the generations. Are you and your heirs ready?
Investment and insurance products offered through RBC Wealth Management are not insured by the FDIC or any other federal government agency, are not deposits or other obligations of, or guaranteed by, a bank or any bank affiliate, and are subject to investment risks, including possible loss of the principal amount invested.
IMPORTANT: The projections or other information generated by RBC WealthPlan regarding the likelihood of various investment outcomes are hypothetical in nature, do not reflect actual investment results and are not guarantees of future results. Results may vary with each use and over time.