Canadians have been told by pension experts that we are not saving enough for our retirement. Since we’re all living longer, we’ll also need more money than our parents did by the time we’re ready to quit our jobs. But one silver lining that people often overlook is that we’ll also be getting more inheritance than in any previous generation.
The average net worth for people usually peak when they’re around the age between 50 and 65. This group of people today are known as the baby boomers 🙂 It is estimated that boomers in the United States will receive $8.4 trillion in inheritances according to the Center for Retirement Research at Boston College. That’s an average of $300,000 per inheriting household. That could mean the difference between retiring at 55 or 65. In last week’s post I mentioned that Canadians have a higher net worth than Americans, so good for us 🙂 Plus Canada doesn’t have any estate tax so that’s even better. Most Canadians (68%) own our own homes, and the average price of a home is $386,000. Even if boomers don’t receive any cash from their parents there’s a good chance they’ll inherit some real estate.
Not everyone is lucky enough to receive an inheritance, but more often than not people do so it should be worked into a financial plan. It might be uncomfortable speaking about inheritance with an elderly parent but estate planning is important for the whole family. More people today will receive an inheritance than a company pension, yet lots of people don’t address inheritance as part of their retirement planning. There has never been a better time to be a baby boomer 🙂 The kids have moved out of the house. The government sends you cheques if you qualify for OAS or CPP/SSI. You have more free time than you know what to do with. And most likely there will be some windfall coming your way 🙂 Almost makes me wish I was a boomer. Okay, maybe not 😛
Random Useless Fact: It takes 2400 liters of water to produce 1 hamburger from scratch