No Bailout From Bequests Seen

It’s been conventional wisdom that baby boomers could expect to inherit estates of $10 trillion to $40 trillion from their parents and grandparents -- windfalls that could secure their retirements.

But a new study by AARP has bad news for those who expect inheritances to cover for a lack of savings: It’s not happening.

AARP, the Washington-based seniors advocacy group, found that as of 2004, just 20% of Americans reported receiving any inheritance. The percentage was higher for those born before 1946, at nearly 30%; for boomers, those born between 1946 and 1964, the percentage was 19.2%.

The median amount inherited was $64,000.

That, the study found, translated to inheritances for all households of under $12 trillion, with $9.2 trillion going to pre-boomers and $2.1 trillion to boomers. The rest went to people born after 1964.

And, the study found, just 15% of boomers expect to receive an inheritance in the future.

“We therefore conclude that inheritances, despite wishful thinking and optimistic projections, are not likely to bail out the boomers,” the report said.

Put another way, it said, “inheritances are unlikely to make a significant contribution to the retirement savings of most boomers.”

The study used data from the Federal Reserve Board’s Survey of Consumer Finances.