Warren Buffett Issues A Warning Ahead Of The $84 Trillion Great Wealth Transfer

Warren Buffett Issues A Warning For All Parents Ahead Of The $84 Trillion Great Wealth Transfer

Chloe Berger  Updated Tue, November 26, 2024  Fortune

Planning your will could make or break your family after your death, warns Berkshire Hathaway CEO and legendary investor Warren Buffett.

"Father time always wins. But he can be fickle,” the 94-year-old billionaire noted in an unusually candid letter released on Monday.

Conversations addressing one’s own death can be a difficult subject to broach. The logistics of what happens to our money and belongings can be an equally dreaded task. But ahead of the $84 trillion Great Wealth Transfer, Buffett asserts that there’s no sense in delaying the uncomfortable and risking future conflicts down the line.

Buffett’s Advice For Parents

As one of the richest people in the world, Buffett is currently worth more than $151 billion. He has voiced his plans for his massive nest egg, pledging in 2010 (alongside Bill Gates and Melinda French Gates) to give at least half of his fortune to charity before his death.

That’s all to say, Buffett’s riches and ensuing estate planning probably seem outside the realm of possibility for most of us. But while Buffett chips away and distributes his massive wealth, he appears to have found advice that’s applicable to more than just billionaires.

“I have one further suggestion for all parents, whether they are of modest or staggering wealth. When your children are mature, have them read your will before you sign it,” he wrote.

Your will should be a dialogue, in the eyes of Buffett. He suggests that parents make sure their children understand “both the logic for your decisions and the responsibilities they will encounter upon your death.” Then a benefactor should answer said questions or concerns, “listen carefully, and adopt those found sensible.”

Buffett admits to doing as much with his kids over the years, and hearing their feedback and suggestions. “There is nothing wrong with my having to defend my thoughts. My dad did the same with me,” he explained.

Many Americans treat money as a taboo topic within their families, but they don’t feel better off for it. Most (56%) say their parents never spoke of money with them, though a striking 81% believe that they would have benefited from having financial education at an earlier age, according to the Fidelity Investments State of Wealth Mobility survey.

Plagued by financial insecurity, younger generations are eagerly awaiting a Great Wealth Transfer—or inheritance from their older relatives. The changing of the tides will likely take place by 2045 and be worth about $84 trillion, Boston-based market researcher Cerulli Associates projected in 2022.

But as boomers and the silent generation prepare to hand off assets and savings, wrinkles start to form. Expectations can be out of alignment, with Gen Z and millennial offspring anticipating to receive more than their elders say they expect to leave behind, according to Northwestern Mutual in ITS Harris Poll survey of more than 4,500 U.S. adults.

And most Americans (72%) report that they don’t feel they have enough financial confidence to manage a large influx of money by themselves, per a Citizens Bank survey of 1,500 U.S. adults. Millennials especially report feeling a lack of confidence in managing a potential future windfall. But a little bit of preparation beforehand could perhaps ease the minds of the privileged young beneficiaries of the Great Wealth Transfer.

When Wills Go Wrong

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