Most Americans aren't ready for the 'Great Wealth Transfer'

As the oldest among the baby boomer generation approach their 80s, younger Americans are standing on the brink of inheriting the wealth accumulated by their parents and grandparents. According to a recent Cerulli Associates report¹, this "Great Wealth Transfer" is expected to involve passing along an estimated $84 trillion over the next two decades — making financial literacy and money management vital skills for Americans to have.

But when it comes to managing a large inheritance, most people say they don't feel ready to handle it on their own.

Citizens surveyed 1,500 U.S. adults, including 500 U.S. small-and mid-size business owners, and found that 72% of Americans don't feel confident in their ability to manage a financial windfall. They also report being unsure about where to turn for financial advice they can trust.

This survey explores how Americans of different ages feel about the upcoming wealth transfer, how they'd manage it and their experiences with financial advice so far.

Many Americans expect to inherit money within 5 years

Almost a third (31%) of Americans believe it's likely or extremely likely they'll inherit some money in the next five years. More than half (55%) of millennials expect to inherit wealth in that time as do 4 in 10 (41%) GenZers.

However, the prospect of inheriting wealth seems to come with anxiety. Most Americans (72%) say they're not prepared to manage a large financial windfall. Business owners felt similarly with 69% admitting they're not completely confident about handling an inheritance.

Americans feel unprepared but aren't sure where to seek help

Financial advice is everywhere. Accredited financial advisors compete with robo-advisors and social media influencers. As a result, Americans aren't quite sure who to turn to for financial advice.

Most Americans (61%) said they would turn to a financial advisor for guidance if they received a windfall while 25% said they'd seek out a banker. But for 29% of Americans, it would take at least a $1 million inheritance for them to seek professional advice on how to manage it.

Why the do-it-yourself mentality? Many people (83%) don't think financial advisors or bankers have their personal financial goals in mind when providing advice. Business owners have similar levels of skepticism, with 79% who said the same.

Instead, people are turning to alternative sources with mixed results. Most Americans (51%) have already acted upon financial guidance they saw on social media. An even greater majority (61%) said they would use a system powered by artificial intelligence for financial advice.

Younger generations say they're getting bad financial advice

Part of what's feeding the all-too-common feeling of distrust is being burned by bad financial advice. Nearly a third of Americans (32%) who previously came into a large sum of money said they received bad advice about what to do with it.

The survey found generational differences. Younger Americans are more likely to say they've received poor financial advice. Most millennials (54%) and Gen Zers (51%) said they've gotten poor advice after a financial windfall compared to just 20% of Gen Xers and 10% of baby boomers.

Bad financial advice doesn't just lead to a loss of some money. It could set you back years on goals like buying a house, saving for retirement or starting a business.

Business owners, in particular, cited digital tools and AI guidance as sources of bad advice. An overwhelming 86% of business owners who turned to these tools for financial guidance faced the consequences of bad financial advice. Having been burned before, millennial business owners are the most likely age group to say they'd seek financial advice from a professional (48%) compared to 23% of Gen X and 9% of baby boomers.

Americans have clear ideas of what they would do with wealth

Despite the uncertainty about being prepared for an inheritance, Americans have a range of ambitions they'd pursue if they suddenly had the means. Among those surveyed, 60% said they would invest it, 51% would pay off debt and 43% would put it toward a large debt payment. Other big plans included starting a new business (34%) or paying for a relative's education (33%).

People also said they'd loosen up a little in their spending. More than a third (36%) would buy a brand-new car, 26% would travel the world and 20% would buy a vacation home.

Even with a windfall, putting money to work on these and other goals takes planning. It's crucial to have a trusted advisor who can provide sound, personalized advice to help you stay on track for your goals.

Having an advisor who understands is important to Americans

Talking about money and goals is personal, so finding someone who can truly understand is essential. Advisors strive to take your greatest financial concerns and ambitions and help you develop a plan to navigate them in a way that works for you.

Most Americans (80%) say they would meet with a financial advisor to help reach their goals. Boomers (79%) are the most likely generation to consult a financial advisor, compared to Gen X at 67%, millennials at 61% and Gen Z at 59%. Across them all, the top common financial goals were investing more (29%), saving for retirement (29%) and building their savings (28%).

A key benefit of partnering with a financial advisor is that they can spot opportunities and strategies in your finances that you might not. Their insight can help you identify what’s most important to you and plan for it effectively. 

When it comes to what they're looking for in an advisor who can lead them through the Great Wealth Transfer, Americans seem to know what they want. Communication is the key quality people look for in a financial advisor (65%), followed by a proven record of success (61%) and understanding their client's unique needs (59%).

The nation is preparing for the Great Wealth Transfer, and Americans must learn and adapt quickly. Millennials and Gen Z are particularly poised to inherit money and assets from their parents and grandparents. They'll have to make choices about who to trust for financial advice — especially when so many say they've been burned before.

As you’re presented with the opportunities an inheritance may hold for you, Citizens is ready to help.

Explanation of methodology

Citizens worked with an independent research firm to conduct the online survey Feb. 16–March 1, 2024. The survey involved 1,500 nationally representative U.S. adults ages 18+, including an oversample of 500 business owners of small and mid-sized businesses, defined as those with an annual revenue of $25 million to $500 million.