Differing views within families are nothing new. For generations, family members have disagreed about everything from culture and politics to religion and parenting. Ranking high on this list of contentious points are disagreements about money — specifically how it is made, spent and saved.
Understanding how families view and discuss money will always be an ongoing endeavor. However, because four generations are currently living simultaneously, the average person enjoys a longer lifespan today than in the past, individuals are more willing to discuss family finances and differing social views, and the desire for older generations to set a good philanthropic example while retaining some control of assets is high, we are taking a moment to explore this topic further.
According to figures cited in a May 2023 New York Times article (subscription required), the total U.S. family wealth of $38 trillion in 1989 more than tripled to $140 trillion in 2022, with Baby Boomers and Gen X holding 90% of that wealth. By 2045, older Americans will pass down a projected $84 trillion to Millennial and Gen Z heirs, with $16 trillion transferring by 2033. With more wealth circulating than ever before, conflicting ideas about who should receive it and how it should be used may arise.
As an advisor, we understand that you are always thinking of ways to help your clients achieve their goals for their estates, financial plans and charitable objectives. As you work with your multigenerational clientele, we encourage you to lean on helpful strategies that can guide you while navigating conversations about charitable priorities.
You can also lean on us here at KZCF! We occupy a unique position amidst the unprecedented wealth transfer currently underway. We can serve as an arbiter, guide and peacemaker for multigenerational families. In addition to understanding the community's needs, the nonprofits and programs that address those needs, and the ins and outs of the tax vehicles best suited for your clients, our team can facilitate productive dialogue among people who bring valuable, diverse viewpoints to the table.
In addition to these points, we:
- Listen to understand the cross-generational and intergenerational values of a family.
- Ask several questions about what causes matter to your clients and the origins of those preferences.
- Pair KZCF Donor Relations staff with family members according to personality and generation to foster more intimate, empathetic and meaningful discussions.
- Research and suggest potential grantee organizations or causes for families seeking input, in addition to providing thorough background on organizations families may already be supporting.
- Educate family members about each funding opportunity (DAFs, Unrestricted Funds, Designated Funds, etc.).
- Our team is happy to develop options for multi-cause allocations that peacefully meet the needs of all involved.
As the needs, capabilities and opinions around wealth expand, KZCF can help facilitate conversations, connections and contributions among families.