As most readers know, I’m a huge fan of Morning Brew, what they do, how they do it, and I’m lucky enough to know that the people behind the service are awesome. They recently published an article titled Getting older is paying off for Americans by Abigail Rubenstein which notes that the 75+ crowd hold the most wealth in America.
This is not surprising, we’ve long been saying that Mom and Dad won at the Game of Life. Mazel! According to the most recent Federal Reserve data, median family net worth rose 2% in last three years while “wealth increased 37% for the 75+ group, but declined 23% for families under 35. People aged 75 and older became the richest group in the US, with their median net worth growing to ~$505,000, compared with $367,000 in 2022. Their mean net worth grew 10% to $1.96 million.”
To underscore the point: the average 75+ family is worth almost $2M due to a rising stock market, home prices, and longevity allowing for compounding. Talk about winning at the Game of Life, indeed!
What does that mean? “The affluence of the 75+ set is a marked change from the earlier dynamic in the US in which older people had less money as they began spending their savings. “This is totally reversed now,” NYU economics professor Edward Wolff told the Wall Street Journal.” This has family, financial, and societal implications that deserve to be explored.
While Mom and Dad are riding off into the sunset, what about everyone else? “Many families are struggling with debt: almost 20% of families reported making a late loan payment over the last year, up from 12.2% in 2022.” And some worry about how Boomers are propping up the economy with their spending, papering over the pain most are experiencing.
So, what does this all mean? Time will tell, but from my perspective, with Mom and Dad (obviously) living longer, the implications and questions can be framed as:
- Housing - Where will they do that? Is it physically possible to age in place? Is there another option nearby? What are Mom and Dad’s wishes?
- Care - Who lives close enough to help them through the day? Can that Sandwich Generation child help enough? Do they want to? Do we need to get professional help?
- Finances - What is the particular family financial situation? What’s the actual budget? Can they afford their wishes? Is the Sandwich Generation expected to pay? Can we?
These conversations need to happen at the Kitchen Table. If not, they will happen over a Hospital Bed or in a Courtroom. But they will happen. And this isn’t about greed or dollars, it’s about honoring the Founders of the Feast. The conversation can start with a gentle, “Mom and Dad, where do you want to be living in 3-5-10 years? How do you envision life then?” This open ended and aspirational conversation should reveal their goals which then frames the subsequent quality of life, need for care, and ability to pay for it questions that follow.
The Business of the Family needs to be run more like a business: Defined goals, honest tracking of what is true, an agreed upon course of action towards those goals, and regular operating mechanisms to track progress. We expect this of businesses worth $2M, why don’t we expect this from the Business of the Family? We can help organize and optimize our family estates to ensure we deliver on the family goals. We can help ourselves and our families move forward…