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Is an inheritance boom coming as baby boomers advance in age?

Edward N. Wolff, an economist at New York University, was once provided funding to study the so-called "inheritance boom" phenomenon -- the expectation that inheritances in the United States would one day become so prevalent that the resulting effect would fundamentally change the contours of American life.

Wolff flatly failed to uncover any evidence of such a boom, saying that "so far it has not really materialized."

The operative word that might be inserted into Wolff's quoted language is "yet," given the huge numbers of baby boomers poised to retire -- and who will be leaving the work force in large numbers for years to come -- who have worked hard to amass savings and now seek to provide to some extent for their heirs and subsequent generations.

Whether in Texas or elsewhere, many of those boomers will seek to leave an inheritance with family members that is administered through a sound estate plan.

A recent New York Times article asks probing questions regarding whether massive transfers of wealth through inheritance might have future adverse effects socially by creating greater wealth inequality. In discussing that subject, though, the Times also notes that wealth concentration in families tends to dissipate over time and that -- at least as regards the super wealthy -- many people (think Bill Gates and Warren Buffett) are very openly committed to using much of their wealth in ways that broadly promote social good.

In fact, and obviously, inheritances are very useful and important tools for people not named Walton or Zuckerberg who simply want to provide in good faith for their family members.

There are a number of planning considerations surrounding inheritances, including, centrally, tax-related matters. Persons with questions or concerns about inheritances, trusts, tax avoidance or any other planning matter can obtain candid and knowledgeable information from a proven estate planning attorney.

Source: The New York Times, “What comes after rich baby boomers? Kids with a big inheritance,” Annie Lowrey, March 11, 2014

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