The greatest generation shares the wealth

Whenever Susan Newman visits an aunt for whom she has power of attorney, a predictable conversation occurs.

"My aunt has all her finances in order, and her things in order," explains Ms. Newman. "She tries to tell me where this is and that is, but I say, 'I don't really want to discuss this.' I can't tell you how many times she's tried to go over it all."

Newman has plenty of company. A study released last week finds a vast communication gap between baby boomers and their parents and relatives on the subject of inheritances and legacies. Although more than two-thirds of those in both generations say they are highly confident about discussing the topic, less than a third have actually done so.

"Most people want to barricade it off," says Newman, a social psychologist who writes about relationships between parents and adult children. "It's really hard to talk about."

Yet these conversations are becoming increasingly important as those in the World War II generation and their offspring, the baby boomers, gear up for what is being billed as the greatest transfer of wealth ever. The Allianz American Legacies Study puts the figure at $25 trillion for all heirs. Already, significant generational differences in attitudes and expectations are emerging.

Nearly 40 percent of those in the older generation say it is very important to pass financial assets or real estate to their children. Only 10 percent of baby boomers feel that way about passing assets to their kids. And only 4 percent of boomers are counting on an inheritance. Longevity is one reason for the diminished expectations. "Because parents are living longer and have new relationships, they're still acting as consumers and spending money on themselves and their new interests in life - vacations, hobbies," says John Mayoue, a family law attorney in Atlanta. "That makes it more imperative for these discussions to begin early if you're the baby boomer expecting an inheritance."

Remarriage is also changing the landscape of wealth transfer. "People who are 50 are seeing their parents remarry," says Mr. Mayoue. "The children come to me and say, 'My father is 72 and he's getting remarried. What does this mean to me? Am I still in the will?' I tell them, 'You'd better go ask him.' "

Although many boomers share Newman's reluctance to discuss these issues, their parents are often even more reticent.

Richard Nummi, a lawyer in Tampa, Fla., has seen firsthand the effects of a failure to communicate. His wife's parents never discussed their estate planning with her. An only child, she assumed she would receive an inheritance. Then her father became disabled and needed care.

"Now that wealth is completely depleted," Mr. Nummi says. "If they had talked to a financial planner 10 to 15 years ago, their circumstances would be completely different" by setting up trusts and shielding assets.

By contrast, he and his parents did talk over their estate. They were able to plan for their later years and protect assets.

Two-thirds of baby boomers in the survey emphasize the importance of receiving instructions on how they should fulfill their parents' last wishes. Carrying out those wishes and distributing personal possessions were five times more likely to be the source of family conflict than the distribution of finances.

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