At first glance, it may look like brazen entitlement: Sixty-three percent of affluent children between the ages of 18 and 22 say financial stability in retirement will depend on inheriting money. As in, the money their parents spent a lifetime accumulating — or given increasing income inequality, inherited themselves.
Before you start growling, consider that this may be a signal of desperation, not greed. The rise in student debt, increased life expectancy and the many competing priorities for money that are considered the “new normal” for younger generations have them wondering how they will pay for it all. According to Aron Levine, head of Merrill Edge, which commissioned a survey of 1,000 “mass affluent” Americans, these young people view inheritance as a sort of safety net.
This is desperation among the mass affluent who presumably have a leg up on much of the population in terms of education, savings and job prospects. The survey defined this demographic as people between 18 and 40 with investable assets from $50,000 to $250,000, or with investable assets between $20,000 and $50,000 and annual income of at least $50,000. Those older than 41 with investable assets between $50,000 and $250,000 qualified, too.
Not only are more members of Generation Z (the ones in their late teens and early 20s) betting on an inheritance, but more think it may come from someone other than their parents. Some 17 percent think it could come from friends, compared with 4 percent of people of all ages. Meanwhile, 17 percent are betting their grandparents have something in store for them, compared with 6 percent of everyone polled. And 14 percent of Generation Z members say extended family will shell out some cash, versus 5 percent overall.
