December 10, 2007, - 12:03 pm
By Debbie Schlussel
They were the first “Me” generation.
The more privileged members of the Baby Boomer generation protested against the Vietnam War on our shores, while their contemporaries gave their lives and limbs to the Viet Cong over there.
They supported illegal drug use, free love/rampant sex, and bra burning. They paved the way for the decline of the nuclear family–today, over 80% of children born to families in Detroit are to single-mother households (and the same goes for other major cities).
They were the most selfish generation. Their parents sacrificed during World War II, but then spoiled them rotten.
And now these spoilees are as selfish in near-death as they were throughout their lives. Dow Jones reports that, even though many Boomers are multi-millionaires, they are leaving little of it to their kids and spending it all on themselves before they die.
But on the bright side, this will hopefully end–with the Boomer generation–the cycle of spoiled counter-cultural senses of entitlement that they had:
The greatest transfer of wealth in history may end up leaving heirs disappointed — and could mean big changes for financial advisers.
As “mass-affluent” boomer millionaires, or baby boomers worth around a few million dollars, start to turn 65, forecasts and patterns in their retirement planning suggest that many may leave little or no substantial wealth to their children.
The affluent boomer crowd typically has plans for a fully funded dream retirement that lasts two decades or more. Having bankrolled kids through years of education and early adulthood, these boomers feel less than obligated to pass along to their children much of their hard-earned wealth. . . .
One recent study by Harrison Group and American Express Publishing, a division of American Express Co., sketches the profile of mass-affluent boomers.
The study describes a group of approximately 2.1 million Americans that has annual discretionary income between $125,000 and $249,000 — that is, income after taxes, mortgage and standard bills — and an average net worth of $1.9 million.
While holding $1.9 million in assets at retirement would seem to assure very comfortable leisure years, paying for that leisure could mean little wealth is left at the end. In fact, more than half (52 percent) of the study’s respondents reported worrying about running out of money before death.
As a result, say economists and financial advisers, when rank-and-file millionaire boomers are pushed to decide between living a full retirement or scaling back post-career spending to preserve capital for their children or grandchildren, a fully funded lifestyle is typically the victor.
“They’re a lot more worried about maintaining their lifestyle than about leaving everybody else wealthy,” says Montgomery.
Academics also see a decline. In October of 2000, Dr. Jagadeesh Gokhale, then a senior economic adviser to the Federal Reserve Bank of Cleveland, and Laurence Kotlikoff, a professor of economics at Boston University, identified what they called a “declining bequest ethic.” They found fewer than half (48.4 percent) of those interviewed for the Federal Reserve’s Survey of Consumer Finance believed it was “important to leave an estate to heirs.” The steepest decline in sentiment during the 1990s — almost ten percentage points — came from Americans age 65 and older.
ME ME ME ME ME ME ME ME ME ME ME ME ME ME.
Tags: American Express Co., American Express Publishing, Boston University, Cleveland, Detroit, Dow Jones, Federal Reserve Bank of Cleveland, Federal Reserve System, Harrison Group, Jagadeesh Gokhale, Laurence Kotlikoff, Montgomery, professor of economics, senior economic adviser, USD