Transfer of $90,000,000,000,000 Wealth Will Be Useless to Many Due to Excessive Spending: Report

A massive transfer of wealth is underway from Baby Boomers to their brethren, but a look at the numbers shows that many won't get what they expected.

According to a CNBC analysis, the “huge” costs of health care will wipe out most boomers' wealth before handing it over to Gen Xers and Millennials.

Front and center is a report from Fidelity that estimates how much individuals need to save to pay their medical costs.

The report found that single people who will turn 65 in 2023 may need to save about $157,500 after taxes to cover health care expenses in retirement.

For couples, that number translates to $315,000 saved.

For context, a 2023 survey from the Transamerica Center for Retirement Studies estimates current levels of retirement savings among the respective generations.

  • Boomers Median Savings – $289,000
  • Gen-Xers Median Savings – $82,000
  • Millennials Median Savings – $49,000

Although money transfers are underway, most people won't get much, and CNBC questions who will be “rich enough to afford the disease.”

“The shocking statistics around wealth transfers often obscure the reality that health care for the elderly is incredibly expensive and often wipes out people's lifetime savings.

Boomers who are concerned about their financial fortunes may be more aware of this fact.

A 2022 study from wealth management firm Cerulli Associates found that 42% of the great wealth transfer will come from high-net-worth and ultra-high-net-worth households, which together make up only 1.5% of all households.

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