[quote=dumbrenter][quote=flyer]From what I’ve read, although many of us late boomers do plan to leave substantial wealth to our kids, the highly discussed “wealth transfer” when broken down, will be concentrated at the top, and will only amount to a few thousand for most as it filters down. Here’s one interesting article on that topic:
With more money flowing out of 401Ks than coming in, what do you think it will do to the funds & the fund managers? More importantly, what will it do for folks who are still putting money in hoping to get tax free gain in say, 30 years from now?
I think the fund fees will go higher since we have smaller number people contributing lower amounts to support the lifestyle of the fund managers.[/quote]
I saw this article as well. I don’t understand why the article insinuates that there isn’t enough active worker-bees today who are putting away $$ for retirement to offset the boomers and beyond who are now removing money from their retirement funds.
Of course, many boomers are helping their Gen Y kids. Especially if they have a straggling kid or two (whom they had later in life) who is still in college. IIRC, flyer’s kids (who don’t reside in SD County) already had paid-off homes in SD which they could sell for a downpayment to buy elsewhere and also had an older family benefactor who provided their college funds. However, the vast majority of families do not have this set-up in place.
I don’t mind helping my kid thru college (essentially just room and board for 4 years). But I myself would be reluctant to financially help my kid if they foolishly trashed their own credit, were addicted to drugs, alcohol or gambling or kept having children without any means to support them. That is, helping them beyond getting them into rehab or directing them to the proper social service agencies and possibly helping them set up appts. And I wouldn’t help them to live above my own means if they couldn’t otherwise afford it.
A lot of us boomers sacrificed our own wants and needs for our children for at least two decades (while they were age 0-22 or so (thru K-12 and often college as well) and we have needs, too. Maybe some of us are willing to take care of grandchildren FT for years for free but I don’t feel like I owe the rest of my life to my kids. And I certainly wouldn’t give them money which would cause ME to go under at a later date, when I am older and more vulnerable to living in poverty.
I feels those boomers who were interviewed for the Barrons article who are giving to their kids to such as extent that it is jeopardizing their own retirement are fools. Their kids (whom they gave a gift of a downpayment on a house, for example), aren’t likely going to have the time, money or inclination to help their parent-benefactor out financially or take them in if they should fall on hard times (or ill health) as a senior citizen.
No one gifted ME any downpayments for a house or even offered to help with my college expenses when I was young and I managed to go thru life paying all my own bills. I expect the same of my kids. If that means living within their means, so be it. That’s life.
