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I came to an important realization this week at France’s Cannes Lions Festival as I watched Nvidia (NVDA), Microsoft (MSFT), and Apple (AAPL) duke it out for the most valuable company on our amazing app.
Like most millennials, I have no idea of the wealth of my baby boomer parents. So, zero idea. No. Zilch. Nada.
Now I suspect neither of them own the rising shares of Apple or Nvidia (I don’t think stocks have ever been their thing), but I think other baby boomer parents do, and may hold their positions until they die .
What’s a millennial to do with these lucrative positions? How do they access their parents’ trading and investment accounts? Have our parents thought about all these things? What exactly do I need to know about their wealth today?
The generational transfer of wealth from boomers to their millennial descendants is beginning – so prepare now, Carla Hassan, JPMorgan’s chief marketing officer, told Rachelle Akuffo and me at Cannes Lions.
“It’s completely uncomfortable. It’s also intimidating,” Hassan said of the money conversations between boomers and millennials.
To start, JPMorgan offers a good example of how to think about planning for intergenerational wealth transfers.
The impact of intergenerational wealth transfer on markets and the economy in the coming decades should not be underestimated.
Cerulli Associates estimates that the wealth transferred through 2045 will be a staggering $84.4 trillion. Broken down, this consists of $72.6 trillion that will be passed on to heirs, while $11.9 trillion will be donated to charities.
More than $53 trillion will be transferred by baby boomers, representing 63% of all transfers.
“Conversations about family money can be emotional and fraught (as seems to be the buzzword of the day), but it doesn’t have to be that way, especially when everyone is on the same playing field,” says personal finance expert Kerry Hannon and pensions from Yahoo Finance. told me.
“It can even start with talking about special objects that your parents have that are meaningful to you, for example a grandfather clock that has been passed down for generations, or a particular painting that you know they bought in Paris during a trip back then. they were just born.”
Take me.
In my head I have created a scenario where my parents will be there forever and The Talk is not necessary. I also remember being scolded by my father when I asked for an allowance – so somewhere in my mind that’s an emotional block.
I also have no idea where to find anything of interest to them if something happens. I don’t even know where my dad lives in Florida; I haven’t seen him since he moved there over five years ago! My mother lives five miles away from me, but I still have to knock on her door to get into the house – no key!
Kerry’s advice is something to keep in mind as I work on that starter conversation with mom and dad.
But as they say: it’s a two-way street!
“More customers are choosing to make wealth transfers to their children while they are alive, rather than waiting until they die, because they can enjoy seeing the impact of their gifts when the children need them most,” said the founder and CEO of Hemington Wealth Management. Eileen O’Connor.
The clock is ticking.
Brian Sozzi is editor-in-chief of Yahoo Finance. He is also the host of the “Starting bidpodcast. Follow Sozzi on Twitter/X @BrianSozzi and further LinkedIn. Tips about deals, mergers, activist situations or something else? Email brian.sozzi@yahoofinance.com. Are you a CEO and want to join Yahoo Finance Live? Email Brian Sozzi.
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