Friday, April 22, 2011
Baby Boomers May Be the First Generation Not to Pass Wealth On to Children, Survey Says.
Counter to what has been projected to be the biggest inter-generational wealth transfer in U.S. History, perhaps $41 trillion by 2052, wealthy boomers may spend their money rather than pass it on to their children, according to a US Trust survey.
Fewer than half of wealthy parents surveyed said it is important to leave a financial inheritance to the next generation, according to a report published today.
U.S. Trust Insights on Wealth and Worth was based on a nationwide survey of 457 adults with $3 million or more in investable assets, not including the value of their home.
The survey shows that few wealthy people have developed plans to preserve and pass on their assets to either their children or charity, according to a press release from US Trust.
Less than a third of the respondents strongly agreed that their children would be able to handle the inheritence they plan to leave them.
Many of the wealthy boomers surveyed are self-made men and women. Close to half said they planned to continue working into retirement. Many had plans to start a second career or new business, and 55 percent intend to actively volunteer in their community.
Having worked hard for financial security, many respondents placed higher importance on travel and personal relationships than leaving an inheritance to their children or making a positive impact on society. Few seem interested in leaving a legacy.
“There is an expectation about the wealthy that they have an implicit, sacred responsibility to pass down their fortune to the next generation, and this understanding has shaped expectations about the coming wave of intergenerational wealth transfer,” said Sallie Krawcheck, president of Bank of America Global Wealth and Investment Management. “Our research, however, uncovered a distinct generational mindset that reflects changing views about what retirement means and an evolving sense of what one generation owes the next."
U.S. Trust also found that the wealthy do not have plans that adequately address the complexity of their financial lives or address unexpected factors that could wipe out a large portion of their assets. Few have plans that make use of trusts to pass on their wealth. And 62 percent have no plan in place to care for aging relatives.
Fifty-six percent have not documented personal property and assets, and half (51 percent) have not documented instructions about the distribution of personal possessions among heirs, often a source of family conflict in the settlement of estates.
U.S. Trust found that many children of these first-generation wealthy families are not doing a good job of handling the emotional and financial responsibilities associated with family wealth. Nearly half do not believe their children will reach a level of financial maturity to handle the family money they will inherit until they are at least 35 years old. About half the parents have not fully disclosed their wealth to their children, and 15 percent have disclosed nothing about the family wealth. Among the reasons parents cited was fear that their children would become lazy (24 percent); would make poor decisions (20 percent); would squander money (20 percent); or would be taken advantage of by other people (13 percent).
by: Leslie Helm
Thursday, April 21, 2011
New College Graduates To Be Cryogenically Frozen Until Job Market Improves
WASHINGTON—In a bold new measure intended to address unemployment among young professionals, lawmakers from across the political spectrum agreed on legislation Tuesday to subsidize the cryogenic freezing of recent college graduates until the job market recovers.
The bill, expected to swiftly pass in both houses, would facilitate the subzero preservation of any graduate of a two- or four-year educational institution. Sponsors of the initiative said that with the national unemployment rate at just under 10 percent, it only made sense for young job-seekers to temporarily enter a state of supercooled stasis.
"Finding employment is extremely difficult for today's college graduate," Sen. Kay Bailey Hutchison (R-TX) said. "Our current economy offers few options for the millions of young men and women desperate to join the workforce."
"Were we to freeze these graduates at the height of vigor and ambition, however, there's a chance we could revive them during a more prosperous time," Hutchinson continued. "When the economy finally bounces back—10, 20, even 30 years from now—we'll have an entire generation thawed out and ready to contribute."
The Frozen For Their Future Act reportedly calls for the installation of thousands of cryogenic tanks at college commencement ceremonies around the country. Upon receiving their diplomas, newly minted graduates will immediately make their way to preservation stations where their hearts will be artificially stopped using electroshock or a potassium-salt solution. Once a graduate's blood is drained and replenished with an anti-crystallizing fluid, they will be submerged in liquid nitrogen, a process that will, in effect, put them into suspended animation until key sectors of the American economy such as real estate and information technology have rebounded.
According to Walter Reardon of the Cryonics Partnership Inc., it will be essential for the freezing procedure to be conducted as quickly as possible.
"Graduates will never be more primed to enter the workplace than at the exuberant moment they toss their caps in the air," said Reardon, who claimed that cryogenics was the only hope for an estimated two-thirds of the nation's students. "Wait even two days, and a graduate's brain will begin to show the effects of fretting about the dismal job market. Wait six months, and you might have a permanently cynical underachiever resigned to his position at a mall sunglasses kiosk."
"Frankly, that person might not even be worth bringing back," Reardon added.
Under the proposed guidelines of the legislation, frozen graduates would remain in storage at a temperature of minus 196 degrees Celsius (minus 321 degrees Fahrenheit) until the unemployment rate fell to a more manageable 4.5 percent. All graduates would also be required to sign a waiver stating that they understood the risks involved, and that there was no guarantee the economy of the future would ever grow sufficiently to warrant their revival.
While acknowledging this danger, Sen. Charles Schumer (D-NY), who cosponsored the bill with Sen. Hutchison, said smaller subsets of graduates could be reanimated as needed if special circumstances created a demand for their skills.
"Let's say there's some sort of environmental crisis," Schumer said. "Well, we could selectively thaw students who majored in ecology or climatology and provide them with jobs. The same logic would apply if, say, 300 years from now a real-world application for people with philosophy degrees somehow arose."
Soon-to-be college graduates were divided about the pending legislation. While some expressed reluctance to induce their own clinical death, other students seemed content to postpone their job hunting for a while.
"Everyone I know is either unemployed or barely getting by," University of Illinois senior Kim Levesque said. "If they want to put me on ice until there are more jobs out there, that's totally fine with me. Not to mention the fact that I won't have to think about my student loans for a while."
When reached for comment, a spokesman for loan provider Sallie Mae said that educational loans taken out by graduates in cryogenic storage would continue to accrue interest indefinitely at 6.5 percent.
about.com (1) Alexandra Nikolchev (1) Andrew Leonard (1) Anya Kamenetz (1) arts (3) asskissing (1) becky lang (1) book review (2) business (4) careers (17) cartoon (4) children (7) colbert report (1) college (8) colleges (12) comic (1) Conan O'Brien (1) creative (2) Dana Faccine (1) dance (1) debt (3) degrees (4) diane ravitch (1) doctor (1) documentary (1) Dr. Seuss (1) drawings (1) Drew Grant (1) drinking (1) economy (7) education (9) ELIZABETH HAYS (1) fail (9) fails (1) first entry (1) for-non-profit (2) Forbes (1) FRESH IS BACK (1) friends (1) frontline (2) Gene Marks (1) generation gap (6) george carlin (1) gifted (3) graduate school (4) graduates (4) graduating (4) graduation (6) HBO (1) hotel finance resourse (1) humor (3) ideas (1) intelligence (2) interests (1) IQ (3) James Marcus Bach (2) Jay Leno (1) jobs (15) jon stewart (1) LAURA PAPPANO (1) learning (3) Leslie Helm (1) letter to the editor (1) literature (1) Los Angeles Times (1) lying (7) major (1) majors (4) MB Quirk (1) Metro Mag (1) minor (1) minorities (1) minors (2) money (3) NPR (2) NYDAILYNEWS (1) NYtimes (2) onlinecollege.org (1) pay (7) PBS (1) PhDs (2) planning (1) profanity (1) rat race (1) reading (1) reform (6) Rutgers (1) s (1) scams (7) science (1) Seattle Business News (1) self-designed major (1) self-education (11) statistics (3) success (7) tangential (1) teaching (9) ted talks (1) testing (1) the Consumerist (1) the Nation (1) the Onion (3) the Salon (2) the specials (1) the Week (1) the young turks (1) Tony Cox (1) toothpaste for dinner (2) tourette's (1) truth (1) universities (8) video (10) WAWG (11) Weird Al (1) William Deresiewicz (1) women (1) writing (4) xkcd.com (2)