The great wealth transfer could be over $100 trillion or $36 trillion

Key Points:

• Visa Business and Economic Insights projects that $36 trillion of baby boomer wealth will be transferred to Gen X and millennials over the next 20 years, significantly lower than Cerulli Associates' estimate of $105 trillion passing to heirs by 2048 from all generations.
• The $60 trillion difference arises because Visa focuses on wealth likely to be spent by everyday consumers and excludes the top 1% wealth holders, retirement spending, taxes, and charity, while Cerulli includes total wealth transfers from all generations and wealth groups.
• Visa estimates that of the $36 trillion transferred, $28 trillion will go into savings and investments, and $8 trillion will be spent on consumer goods like cars, homes, and travel, emphasizing a more realistic view of wealth impacting everyday spending.
• Cerulli highlights that half of the $105 trillion wealth transfer will come from high net worth or ultra-wealthy families, with significant implications for wealth management services rather than consumer spending, and notes that initial transfers will often be to surviving spouses.
• The debate over the size and impact of the great wealth transfer underscores its importance for financial firms and wealth managers preparing for shifts in wealth distribution and investment patterns in coming decades.