In the next two decades, the largest intergenerational wealth shift in history will unfold.
Baby Boomers and the Silent Generation are transferring assets at a pace never before seen. Cerulli Associates estimates that about $84 trillion will change hands in the U.S. through 2045, with $72 trillion flowing to heirs and nearly $12 trillion going to charity.
Numbers this large can dominate the headlines, but the real story is about preparation and protection. Families who believe they’ve completed their estate plans once the technicalities, such as documents, valuations and tax strategies are in place, might be overlooking critical risks.
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Kiplinger’s Adviser Intel, formerly known as Building Wealth, is a curated network of trusted financial professionals who share expert insights on wealth building and preservation. Contributors, including fiduciary financial planners, wealth managers, CEOs and attorneys, provide actionable advice about retirement planning, estate planning, tax strategies and more. Experts are invited to contribute and do not pay to be included, so you can trust their advice is honest and valuable.
Without further steps, heirs might face confusion, conflict or costly mistakes. Those who go further to invest in communication, education and shared purpose might avoid common pitfalls and turn inheritance into a lasting legacy.
Start while you’re living
One of the most powerful ways to protect family wealth is to prepare heirs before they inherit. Families who wait until death to hand down responsibility often leave heirs without the experience or judgment needed to manage wealth wisely.
By contrast, sharing wealth — and decision-making — during your lifetime creates a controlled environment for learning, growth and risk reduction.
Make lifetime gifts part of your wealth plan. Instead of waiting for a full inheritance, gifting a manageable amount of cash or stock allows heirs to practice stewardship.
In family businesses, small equity stakes help the next generation learn operational and governance responsibilities, reducing the risk of disruption later.
Tie transfers to life milestones. Linking wealth to achievements such as graduating college, landing a first job or completing financial training provides natural opportunities to build maturity.
These standards help prevent premature or mismanaged transfers.
Involve heirs in philanthropic decisions early. Giving younger family members the responsibility to allocate charitable funds teaches disciplined decision-making and values alignment, reducing the risk of misaligned giving or disconnection from purpose.
By integrating these practices, families can help ensure that heirs have tested their decision-making, experienced consequences in a safe setting and built the confidence needed to manage larger sums — all before the full estate is transferred.
Prevent conflict with clear, updated plans
Having legal documents in place is essential — but not sufficient. Failure to keep them updated or to clearly communicate plans to heirs is one of the most common causes of estate disputes, legal delays and unintended outcomes.
Engage wealth advisers early. Working with legal, tax, and financial professionals ahead of time allows for thoughtful, iterative planning — avoiding rushed decisions in crisis moments.
Update documents after major life or financial events. A marriage, divorce, new grandchild or business change can render old plans obsolete, leading to misallocations or disputes. Regular reviews help keep intentions aligned with current reality.
Provide heirs with a clear inventory and instructions. Without access to key documents or understanding of how to manage complex assets such as real estate or private businesses, heirs can be left vulnerable to costly mistakes, delays or litigation.
Clarity eliminates ambiguity. When heirs understand the plan and where to find everything, transitions are smoother, legal risks are minimized and conflict is less likely to arise.
Break the silence around money
Many families avoid talking about money, hoping to protect harmony and keep heirs motivated to build their own successes. But silence can lead to confusion, mistrust and division.
Open, structured communication is one of the most effective ways to reduce the risk of future conflict.
Schedule regular family meetings. These create a cadence of transparency and engagement. Reviewing investments, charitable goals or business strategies together keeps the family aligned and prevents future surprises.
Create a mission statement or legacy letter. Explaining the “why” behind the plan gives heirs context and a shared philosophy, helping them make decisions that honor the family’s intentions and avoiding future misinterpretation or misalignment.
Share access to key documents and digital records. When everything is centralized and accessible, it reduces stress and confusion during transitions and lowers the risk of costly delays or missed opportunities.
These communication habits build trust, reduce uncertainty and ensure that wealth transfers happen in the context of shared understanding and purpose — not assumptions and guesswork.
Financial literacy is a safeguard, not a luxury. Even with a clear plan and open dialogue, the technical complexity of wealth management remains a major risk area.
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Without training, heirs might feel overwhelmed or make irreversible mistakes — jeopardizing the legacy.
Provide formal financial education. Courses or workshops on investing, taxes and estate planning give heirs the tools they need to make informed decisions—and avoid costly errors.
Encourage heirs to shadow advisers and take on responsibilities. Involving them in investment reviews or charitable evaluations creates real-world experience and gradually builds competence, reducing the risk of poor judgment later.
Teach liquidity and diversification. Understanding the difference between liquid and illiquid assets helps heirs avoid scenarios in which they must sell under pressure or make short-sighted decisions in times of need.
Proactive financial education ensures that heirs are not only confident but also capable, reducing the risk that inherited wealth is mismanaged or quickly depleted.
Align wealth with values and impact
Families that treat wealth as a tool for impact — rather than just a resource to preserve — tend to see greater alignment across generations and fewer internal conflicts.
Involve heirs in grant-making. This teaches responsible capital allocation and connects financial decisions to deeper values, reducing the risk of detachment or aimlessness.
Use family foundations or donor-advised funds as training grounds. Assigning real roles and responsibilities builds skills in governance, collaboration, and administration, all of which may help reduce the risk of dysfunction.
Encourage heirs to define how wealth should serve others. When each generation articulates their vision of impact, it ensures the legacy remains relevant and grounded and can help to avoid drift or disconnection.
Philanthropy isn’t just an outlet for generosity — it’s also a powerful mechanism for teaching responsibility and fostering unity, while shielding the family from the risk of purposeless wealth.
The real measure of success is preparedness
The Great Wealth Transfer will shape the global economy, but for families, its effects are deeply personal. The greatest risk is not taxes, markets or inflation. It is unprepared heirs.
Success will not be measured solely in account balances but in how well heirs uphold values, strengthen relationships and manage responsibilities.
Families that begin early, communicate clearly, maintain updated plans and invest in financial education are far more likely to avoid common pitfalls and preserve their legacy for generations to come.
The money will move either way. The outcome — whether it becomes lasting wealth or fleeting fortune — depends on how well families prepare.
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This article was written by and presents the views of our contributing adviser, not the Kiplinger editorial staff. You can check adviser records with the SEC or with FINRA.
