American baby boomers who amassed massive wealth through stocks and businesses are spending it on their retirement and leisure rather than passing it on to their children. As a result, the transfer of wealth from older Americans to younger generations is expected to take far longer than the market anticipates.
Money Built Through Stocks, Now Spent in Retirement
According to a Wall Street Journal report Monday citing Federal Reserve data, the total assets of U.S. baby boomers (ages 61-80) stood at $89.7 trillion as of the fourth quarter of 2025.
Adding the $20.6 trillion held by those aged 80 and above, the total wealth controlled by older Americans reaches $110 trillion. By contrast, millennials and Generation Z together hold just $18.7 trillion.
A significant portion of this wealth comes from stocks. Equities and funds account for 33% of baby boomer assets and 43% of assets held by those aged 80 and above. The figures reflect decades of growth in stocks purchased and businesses founded long ago.
In the fourth quarter of last year alone, baby boomers added more than $1 trillion in assets, the largest increase among all generations.
Inheritance Goes to Spouses First, Children Much Later
The issue is that this money does not flow directly to children.
The biggest reason is longer life expectancy. A recent analysis by Harvard economist Raj Chetty and others found that the top 1% of income earners typically live into their late 80s. A UBS survey of 87 billionaire clients also found that 81% of respondents expect to live longer than they did a decade ago.
The longer people live, the more they spend. Among wealthy older Americans, a clear trend has emerged of spending heavily on luxury travel, premium retirement communities, and health care.
Even upon death, assets pass first to spouses rather than children. According to an analysis by research firm Cerulli Associates, about $1.3 trillion in wealth is expected to transfer between spouses in the U.S. this year, while only about $2 trillion will pass down to Generation X and younger.
The age at which people inherit is also rising. Federal Reserve surveys from 1998 to 2010 showed those in their late 50s were most likely to receive inheritances, but surveys from 2013 to 2022 showed the peak age had shifted to the mid-60s. Cerulli predicts that over the next 12 years, the generation set to inherit the most will not be millennials but Generation X, those aged 45 to 61.
"Everyone says the money is going to millennials and that millennials are the next big opportunity, but that's quite a ways off," said Chayce Horton, associate director at Cerulli.
