A recent poll from CNBC shows that a large majority of American millionaires are planning on leaving their wealth to their children. The millionaires say that charitable causes, philanthropies, and social causes score low on their list of inheritance priorities. This poll comes just as the nation is beginning the largest cross-generational wealth transfer in its history.
Millionaires and Their Families
The CNBC millionaires poll shows that Americans with assets of at least $1 million will leave their money almost entirely to their children. More than half of all survey respondents say they plan on leaving their children inheritances of at least $1 million, while 20 percent say they will leave at least $500,000. Only about four percent said they want to leave their children less than $100,000.
When it comes to charities, the millionaires say that leaving inheritances to charitable groups is low on their list of concerns. Almost two-thirds of respondents say they plan to leave less than 10 percent of their wealth to charities, while about 20 percent said they plan on leaving nothing at all. Despite well-known wealthy people such as Bill Gates and Warren Buffet pledging their wealth to charitable causes, the general desire amongst millionaires seems to be to keep wealth almost entirely in the family.
Historic Wealth Transfer
The inheritances the millionaires plan on leaving come as a part of the largest generational wealth transfer in the nation’s history. It’s been estimated that, over the coming decades, between $30 and $49 trillion will transfer from the baby boomer generation to members of Generation X, or the millennials. If the survey data is accurate, this wealth transfer will take place largely within family relationships, and relatively little of that wealth will see its way into the pockets of charities or philanthropic organizations.
Squandered Inheritances Not a Concern
While the millionaires who answered the survey questions are not planning on leaving much to charity, they are also not too concerned about the inheritances their children receive going squandered. Despite significant evidence to show that most family wealth does not last longer than three generations, the survey respondents
don’t seem to worry about it. About 60 percent of the millionaires say that there is no inheritance too large to give, while about 40 percent said they are confident their children will be responsible with the money they receive. Only about 17 percent expressed concern that the inheritances they give might lead their children to not be self-reliant. 84 percent of the millionaires have no plans to leave any instructions or restrictions on how the inheritances should be used.