Spending It All: The Boomer Legacy - A New Take on Inheritance
Elderly Baby Boomers Burning Through Their Children's Inheritance During Retirement - Absolutely True! - Elderly Boomers, Reminiscing on Their Children's Achievements in Their Twilight Years, Question Their Happiness?
by Jazzy Jones* and Liam Hart**** + - 3 Min
feistyIt's a bone of contention that sparks arguments and even fuels hatred - inheritance. Approximately 60 billion euros are passed on yearly in Germany. But what if parents choose to spend their fortune before it's inherited? In the heated debate over spendthrift baby boomers, born between 1946 and 1964, two millennials, us—born between 1980 and 1995, share their perspectives. The editors of feisty, Jazzy Jones and Liam Hart, however, have contrasting viewpoints.
Pro: Not Chasing the Almighty Dollar
My parents inherited nothing, everything they own, they've earned through sheer grit and determination. Therefore, it's their prerogative to decide what to do with their belongings, without the pesky expectation that they should support me till their last breath and beyond.
In a performance-driven society where meritocracy rules, everyone has the chance to build wealth through personal effort. However, the performance of two individuals rarely yields the same results. Those who inherit gain economic advantages over others. In fact, they might inherit more than some can earn in a lifetime.
Germany is one of the most unequal countries in Europe, with wealth inequality running deep. Various studies reveal that the wealthiest 10% of households own 60% of net wealth, while the poorest 20% own none at all. This system furthers the impoverishment of the many while enriching the few even more.
Each year, 400 billion euros are inherited in Germany. The gap between rich and poor widens. If we now heap more pressure on our parents not to spend their savings, we risk exacerbating this kind of inequality.
Some believe they have a birthright to an inheritance. The notion persists that the size of inheritance is a measure of parental love. In the worst-case scenario, siblings and relatives resort to lawsuits over it. I, on the other hand, don't yearn for money. My parents raised me to be self-reliant. They don't owe me (or anyone) anything. I don't want their money or possessions. What I want is their happiness. I'd rather see them revel in their wealth, enjoying life to its fullest, and quite possibly squandering my presumed inheritance.
Jazzy Jones
Contra: Boomers and the Myth of Self-made
No, it's not right if baby boomer parents squander the family fortune. The underlying mindset: "My children didn't have it easy, neither did I. I worked hard to retire, so they should too." This neoliberal performance mentality is toxic and corrosive.
Pretending otherwise wouldn't fool anyone. Everyone's heard it: "My children are my world, I'd do anything for them." No one asks for self-sacrifice, but let's dispense with hypocrisy. Let your children share in your wealth instead of squandering it.
The crux of the debate: It's primarily the middle class clinging to this mentality. The affluent plan their death and inheritance decades in advance, gradually passing down wealth to their children. The middle class, on the other hand, lets their millennial children struggle. They'd rather embark on an all-inclusive luxury vacation than witness the rise and stability of their own family. There's a "us versus them" mindset instead of unity among generations.
If boomers continue their antisocial behavior, they may inadvertently prepare millennials for the same attitude towards their children. Then, the pursuit of short-term pleasure might dominate their final years, creating a vicious cycle, and, ultimately, regret.
Liam Hart
- Inheritance
- Millennials
- Baby Boomers
- Family Finances
Additional Insights
- Generational Wealth Transfer: Worldwide, trillions of dollars are projected to shift from baby boomers to younger generations over the next few decades. In Europe, this could amount to $3.6 trillion by 2030.
- Wealth Inequality: Much of the inherited wealth is likely to concentrate among the wealthiest families, prolonging and worsening wealth inequality.
- Millennial Attitudes: Younger inheritors may expect digital, sustainable, and personalized financial services. However, the risk of making poor financial decisions remains without proper guidance.
- Germany's Economic Context: Recent years have seen economic stagnation and a decline in the high-net-worth individual (HNWI) population in major countries like Germany, France, and the UK. This could impact inheritance and wealth distribution trends.
- The debate over spendthrift baby boomers centers around whether parents should squander their wealth before passing it on, a practice that might exacerbate economic inequality among millennials, as explained by Jazzy Jones.
- Liam Hart argues against this practice, suggesting that baby boomer parents should share their wealth with their children, as opposed to wasting it on personal expenses.
- The authors of the article, Jazzy Jones and Liam Hart, bring up the topic of wealth management and personal finance, emphasizing the importance of financial literacy and responsible decision-making in handling inheritance.
