At least the will won't be an issue

The Middle Ages

Staying young, growing old and what happens in between

July 06, 2008|By SUSAN REIMER

Amid the torrent of unhappy economic news comes this from The New York Times: Our children shouldn't expect to inherit anything from us except, perhaps, a tendency toward male pattern baldness.

Ron Lieber wrote last week that boomers have so many more demands on their retirement savings - from health care costs to a desire for a comfortable lifestyle - that there won't be anything left in the piggy bank for the kids when we go.

Whether that is good news or bad depends on whether you are me or my kids.

My husband and I now have a vague kind of permission to spend down our savings to the last dime. Apparently, everyone else is doing it.

Meanwhile, our children can not count on benefiting financially from the fact that both Mom and Dad worked, had 401(k)s and substantial life insurance policies to cover the problematic death of either wage-earner.

This is going to come as a terrible shock to my children and anyone else's children who read the crazy headlines of a few years ago that something like $41 trillion was supposed to move from the Greatest Generation to the Boomer Generation to the Generation Next over the next 50 years.

That doesn't appear to be panning out.

According to a MarketWatch news story, the median value of a boomer's inheritance is about $48,000. Only 2 percent received more than $100,000, according to a consumer wealth research report.

And we're going to run through that pretty fast.

Lieber reported in the Times that the pressure on our savings is only going to grow as boomers, who are living, on average, into their mid-80s, age into assisted living. At the same time, we can expect to see Social Security and Medicare benefits contract.

Most of our employers will not be providing pensions or health-care benefits in retirement, so that means we are wedded to the stock markets to pay for our prescriptions and our winters in Florida. And we all know what a roller-coaster ride the market has been.

In addition, Lieber wrote, more and more of us are taking advantage of reverse mortgages - drawing down the equity in our homes to finance a lifestyle that we do not want to see diminish as we age.

The family homestead, which once might have gone to the heirs, will now go to the bank when we die.

But there is some good news for the kids.

Apparently, we control-freak boomers want to see our money make our children happy while we are still alive to witness it.

We are more likely to give financial gifts to our children, pay for a grandchild's college, help with a down payment on a house or simply bail them out of financial trouble.

It doesn't look like the kids have to wait until the lawyer reads the will to benefit.

When my own mother died, she did not leave my sisters and I much more than the cost of a week at the beach, yet we were all stunned by this bittersweet gift from her.

I always thought I'd be able to go one better for my own children, but it doesn't seem likely, and I am not sure why that matters to me.

After all, I won't be around to see their disappointment.

susan.reimer@baltsun.com

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Read recent columns by Susan Reimer at baltimoresun.com/reimer

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