A stunning $72.6 trillion may be handed down in the next decade. How much will you inherit?

Baby boomers—those born between 1946 and 1964—control the bulk of this. They’re expected to transfer a whopping $53 trillion, while their own parents, part of the Silent Generation (born between 1928 and 1945) will hand down another $15.8 trillion. On top of this, some assets are still in the hands of an even older group, the so-called Greatest Generation, born before 1928. It’s estimated there are some 670,000 men and women in this august group.

Some context to all this. The current size of the U.S. economy, measured by gross domestic product, was $26.5 trillion in the first quarter of 2023 according to the St. Louis Federal Reserve. 

Any way you slice it, that’s a lot of money. 

But how will it be distributed? The figures are all over the map. A new survey by New York Life’s Wealth Watch says 15% of adults it surveyed expect to receive a whopping $738,724. Meanwhile, an HSBC survey said that retired Americans plan to leave an average $177,000 to their heirs, while a 2019 study by the Federal Reserve’s Survey of Consumer Finances (SCF) found that the average inheritance in the U.S. is about $110,000.

An average $110K? Most folks would be thrilled. But average figures are one thing. What truly counts here is the median figure, and here the numbers are naturally far more modest. 

To illustrate the difference between average and median, let’s say that 67-year old Bill Gates, the Microsoft co-founder currently worth $121 billion, plans to give all his money to me (obviously a splendid idea). And lucky me: So does Joe Sixpack, who’s worth $5,000 and James Pennypoor, who has $500. I’m deeply grateful to these three gentlemen for their generosity.  

My average inheritance (the sum of those figures divided by three) would be $40 billion and change. But my median inheritance would be $5,000 — the midpoint between the three figures. 

And that’s why the median figure is the one that counts. It’s far more reflective of the true amount of money that most folks are likely to inherit.

The Fed’s SCF stated that the average inheritance was $707,291, in the ballpark with the New York Life’s average figure of $738,724. But the median inheritance, the Fed estimated, was $69,000. For what it’s worth, the New York Life study did not appear to include a median figure. 

NewRetirement.com adds additional context. Citing data provided by United Income, a Washington, D.C.-based investment management and financial planning company, it reports that the average retired adult who dies in: 

• His or her 60s leaves behind $296,000 in net wealth

• $313,000 in their 70s

• $315,000 in their 80s

• $283,000 in their 90s

I emphasize as above, that these are average figures, so median figures will certainly be considerably lower. 

What’s also interesting about the above figures is how net wealth levels off at a certain age and then declines. Why is this? I suspect it’s because of healthcare spending, which tends to accelerate as we get older. We’ve noted before that a couple retiring at age 65 will need $315,000—estimates Fidelity Investments—to pay for medical care above and beyond what Medicare will. 

This spending is not distributed evenly. In other words, if you live an additional 25 years beyond age 65, you’re not going to spend $12,500 a year ($315/25). You may spend little in your 60s when your health is pretty good, but more in your later years.

Needless to say, this could also affect what we’re able to hand down to our children and grandchildren. While a long life can certainly be regarded as a blessing, mounting healthcare spending is likely to cut into what eventually gets passed down. Best to be in Mr. Gates’s shoes.