Boomers are about to offload trillions of dollars to next generation

Baby boomers, currently the wealthiest generation on the planet, are expected to pass on roughly $83.5 trillion to the next generations in the next 20 to 35 years, according to a recent study by Swiss investment bank UBS. The biggest wealth transfers, at a global level, are expected in the Americas.

About $9 trillion out of this total estimated sum will be first transferred horizontally between spouses, primarily in the Americas, this year’s UBS Global Wealth Report estimates. As women generally live longer than men and couples often have an age gap, the inheriting spouses are expected to own and hold onto this wealth for an average of four years before passing it on to the next generation, the report estimates.

More than 10 percent of the estimated $83.5 trillion is likely to be transferred to the next generation by women, UBS experts write. It will be Gen Xers and millennials—respectively born between 1965 and 1980 and 1981 and 1996—who will inherit this huge sum, as the average age of the recipients is estimated by UBS experts to be roughly 59.

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The individuals passing on wealth will be just about 84 years old. Boomers were born between 1946 and 1964, and they’re now between 60 and 78. Newsweek contacted UBS for comment by email on Friday morning.

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The amount of transferable wealth per person in the Americas will be nearly $1,200,000, much more than in the Asia-Pacific and Europe, Middle East and Africa (EMEA), which remains respectively about $100,000 and $300,000.

According to the Federal Reserve data, boomers in the U.S. have an aggregate total net worth of $78.55 trillion. Many own a home, have already paid off their mortgage, and have a lifetime of savings they will one day pass to their children and spouses.

By comparison, American Gen Xers, according to Federal Reserve data, currently hold a total of $39.09 trillion, while millennials hold only $14.21 trillion.

A big chunk of the total wealth that will be passed on by boomers at the global level, $83.5 trillion, is likely to be transferred already in the next 10 years, as people over the age of 75 hold nearly one-fifth of the world’s overall wealth and the average life expectancy ranges between 82 and 86 across most of the world.

Parts of this wealth could be lost to administrative fees, legal costs and inheritance taxes. Even so, the one between boomers and Gen Xers/millennials could be the greatest transfer of wealth in history.

If you’re a baby boomer, how much money do you expect to pass on to your family? If you’re a Gen Xer or millennial, how much money do you expect to inherit from your parents? Contact g.carbonaro@newsweek.com.