Key Highlights

  • Boomer generation to top out by 2030
  • Estimated $59T transferring to next generations

Baby Boomers to Top Out by 2030

Baby Boomers, those born between 1946 and 1964, will reach their zenith by becoming 65 years and older in 2030.  By being the nation’s largest demographic up until the coming-on-strong of the Millennials, Boomers have been key influencers in every aspect of society.

Boomers Taking Lead in Great Wealth Transfer to Next Generations

 

The last Boomer hurrah in terms of wielding enormous influence is the Great Wealth Transfer.  Already underway, an estimated 73M Boomers are expected to transfer up to $59T in wealth via inheritance and assets to the next generations.

The size and scale of this wealth transfer will likely have a huge impact on real estate markets over the next 10 – 25 years.

Supply and Demand Shifts

Boomers are already shifting aspects of their estate planning to reduce tax burdens for their heirs.  They’re already simplifying and/or reducing their real estate portfolios. And, some are already preparing for their own care when they can no longer do it for themselves.

It’s estimated that Boomers have $6T of real estate equity today.  As they continue aging, they will likely increase the supply of single-family housing by either putting their homes on the market or transferring their homes to their heirs.  Also, Boomers will likely increase the demand for senior housing, however that sector develops.

According to Fannie Mae,predictions are that Boomers will increase the number of for-sale single-family homes to 10.5M – 11.9M by 2026.  Obviously, such a supply increase would be a welcome relief to all potential players within the single-family home market nationwide.

Gen-Xers, Millennials and Gen-Zers Set to Inherit Millions from their Boomer Parents and Grand Parents

Boomer heirs are the most likely recipients of the Great Wealth Transfer. Some Gen-Xers, Millennials and Gen-Zers may want to keep their parents’ or grandparents’ property for their own primary or secondary residence.  Some may want to keep that property for short- and/or long-term rental income.

Next generations investors may want to buy a home in probate as a way to focus on distressed properties for both multiple and/or out-of-state heirs.

Key Ingredient for Heirs and Boomers Alike is Estate Planning

A key necessity for all involved in this Great Wealth Transfer is thoughtful, thorough estate planning.    Boomer parents and grandparents want to make their “transfers” to their “kids” as easy and inexpensive as possible.  The “kids” want to avoid weighty inheritance taxes

Discussing, strategizing and agreeing to all aspects within the Great Wealth Transfer are key elements of effective estate planning for all involved before such estate planning is set in stone.

Essential Team Members Necessary for Smooth, Inexpensive and Amicable Great Wealth Transfer

Highly qualified and reputable estate tax specialists and tax attorneys, financial advisors AND real estate professionals are essential team players to make a family’s Great Wealth Transfer as effective, inexpensive and amicable as possible.

Some families may also want to include a highly qualified family psychologist or family counselor to help ensure that everyone involved in the giving and receiving of wealth listen to, hear and comprehend the economic implications of money and assets changing hands.

 

Thanks to Millionacres.

 

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