June 18, 2012 at 11:50 AM ET
Who would have thought the younger, spoiled generations would be more generous than baby boomers when it came to looking out for their families?
A study of wealthy Americans found that 40 percent of adults younger than 46 — the Generation X and Generation Y set — already have established financial plans to help care for their parents as they age, compared to only 20 percent of baby boomers who have done so, according to a survey released Monday by U.S. Trust, the global wealth and investment management unit of Bank of America.
And, the poll found, 54 percent of Gen-Xers and Gen-Yers paid some medical costs for their parents and other relatives, compared to 42 percent of boomers.
The online survey, conducted in March, polled 642 adults with at least $3 million in assets, not including their primary homes. It points to different financial attitudes among the generations, “most likely shaped by personal experience and societal responses to economic realities,” said Keith Banks, president of U.S. Trust.
“I don’t think the boomers are stingier,” Banks maintained, pointing out that some boomers may no longer have parents to care for anymore, or at least are not as likely to be doing so as younger folks.
What concerns him is that the younger and older generations both have to help family members at such high rates when it comes to things like medical care.
Overall, he added, there more commonalities among the generations than differences, except when it came to wealth transfer.
The poll found that when it comes to leaving money for their kids, the younger group said they were more inclined to pass along an inheritance than boomers, at a rate of 76 percent versus 55 percent.
Indeed, even high net-worth individuals are cautious about their wallets these days.
“Many boomers are beginning to realize that they are underfunded for retirement in any traditional sense,” said Jim Lee, a financial planner and author of “Resilience and the Future of Everyday Life,” which includes a chapter on how perceptions of retirement are changing.
“Given record low interest rates and a decade of minimal returns for the stock market, some boomers have been spending down their portfolios sooner than they anticipated,” he explained. “Add longer life expectancies into the mix, and you've got a recipe for smaller inheritances.”
Here are some additional findings from the U.S. Trust survey:
More money and business news: