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MOST young, wealthy Americans believe it's important to pass
money on to their heirs. They may be disappointed to learn that their parents
don't feel the same way.
In an annual survey of the wealthy released on Monday by US
Trust, a division of Bank of America Corp, three-quarters of wealthy adults
under age 46 said it's a priority to leave money for their kids.
But just 55% of Baby Boomers - those aged 47 to 66 - said
they share that sentiment. In fact, one of every three surveyed said they'd
rather leave money to charity than to their kids.
Their reasoning? Some said they believe that each generation
should create its own wealth, while others said it's more important to invest
in children's success while they are growing up, according to the survey of 642
individuals who have at least $3m in investable assets.
"Our survey points to a shift in generational behaviour
and outlook, most likely shaped by personal experience and societal responses
to economic realities," said Keith Banks, president of US Trust.
Most of those surveyed don't even talk to their kids about
money: just 37% said they've fully disclosed their net worth to their children.
Those over 67 said they weren't having this discussion
because they were raised not to discuss money, while younger respondents said
they didn't want to inhibit their kids' work ethic.
A few other highlights from the study:
- Six in 10 wealthy parents are not fully confident their
children will be well prepared to handle an inheritance. Baby Boomers have the
least degree of confidence.
- Forty-two percent of Baby Boomers and 54% of those under
46 are paying medical costs for their parents or other relatives.
- Two-thirds of those surveyed have not made, nor do they have plans to make, a monetary gift to family members to reduce the size of their taxable estate before the end of 2012, when US tax laws are expected to change.
