Keeping Current Matters August 15, 2024
Buyer
In recent years, there’s been a significant shift in how wealth is distributed among generations. It’s called the Great Wealth Transfer.
Historically, the transfer of wealth from one generation to the next was a more gradual process, often limited to smaller amounts of inheritance or family savings. But today, the scale has increased in a big way. As a recent article from Bankrate says:
“The biggest wave of wealth in history is about to pass from Baby Boomers over the next 20 years, and it’s going to have major impacts on many facets of life. Called The Great Wealth Transfer, $84 trillion is poised to move from older Americans to Gen X and millennials. If it’s managed smartly, Americans will be able to grow their wealth and ensure their financial security.”
Basically, as more Baby Boomers retire, sell businesses, or downsize their homes, more substantial assets are being passed down to younger generations. And this creates a powerful ripple effect that’ll continue over the next few decades. The graph below uses data from Merrill and Cerulli Associates to give you an idea of how much inherited money is set to change hands through 2045:
One of the most immediate effects of this wealth transfer is on the housing market. Home affordability has been a concern for many aspiring buyers, especially in high-demand areas. The increase in generational wealth is expected to ease some of these challenges by providing future homeowners with greater financial resources. As assets are passed down through generations, buyers may find themselves in a better position to afford homes. Merrill talks about that benefit in a recent article:
“While millennials face steep barriers . . . to buying a first home in many markets, ‘that’s a for-now story, not a forever story’ . . . The Great Wealth Transfer should enable more of them to become homeowners — or trade up or add a second home — either through inherited property or the funds for a down payment.”
But the Great Wealth Transfer doesn’t just impact housing. It’s also going to provide a new avenue for entrepreneurial spirits to fuel economic growth. If someone is looking to start a business and they’re receiving funds like this, that money can used as the necessary capital to start a new company. This helps the next generation of innovators and business owners bring their ideas to life.
While affordability remains a challenge in today’s housing market, the ongoing Great Wealth Transfer is poised to unlock new opportunities. As wealth is passed down and put to use, it’s expected to ease some of the barriers to homeownership and fuel other entrepreneurial endeavors.
Stay up to date on the latest real estate trends.
Buyer
August 29, 2025
You may have seen talk online that new home inventory is at its highest level since the crash.
Buyer
August 29, 2025
It’s not unusual for designers to use their own homes as a mad laboratory, fiddling with new materials, half-baked ideas, and “could this work?
Lifestyle
August 28, 2025
It just happens that one of the most accessible and budget-friendly forms of exercise is also the most beneficial for your health: walking.
Seller
August 28, 2025
Now that the market is slowing down, homeowners who haven’t sold at the price they were hoping for are increasingly pulling their homes off the market.
Buyer
August 26, 2025
Sales of new single-family houses in July were at a seasonally adjusted annual rate of 652,000, according to estimates released jointly today by the US Census Bureau a… Read more
Buyer
August 26, 2025
If you’re still worried about having to deal with a bidding war when you buy a home, you may be able to let some of that fear go.
We Guide Homeowners through the complicated process of selling their home using our 4 Phase Selling Process and 3 Prong Marketing Strategy that alleviates their stress and moves them effortlessly to their next destination. Schedule a 15 Minute Complimentary Strategy Session Today