The Great Wealth Transfer is the term being used to describe the gradual transfer of wealth from baby boomers to younger generations and charities. This transfer is expected to have a significant impact on the U.S. economy over the next twenty years. Perhaps more significantly, this is roughly the same time period that we expect to see dramatic (15%) declines in high school aged populations in the US.
How much wealth is being transferred?
Estimates
Researchers estimate that $84 trillion in assets will be transferred from baby boomers and the Silent Generation to their heirs through 2045. This includes $72.6 trillion going directly to heirs and $12 trillion going to charities.
Who will receive the wealth?
Generation X: Born 1965–1980, this generation is expected to inherit $30 trillion.
Millennials: Born 1981–1996, this generation is expected to inherit $27 trillion.
Gen Z: Born 1997–2012, this generation is expected to inherit $11 trillion.
How is the wealth being transferred?
Giving while living
Baby boomers are increasingly passing assets on to their children while they are still alive.
Women
Women of the baby boom generation are playing a key role in the transfer of wealth, redirecting money to charity and long-term healthcare.
Implications for Wittenberg
On the one hand, this elevates the importance of Advancement for Wittenberg and other colleges and univerisities. If Wittenberg is going to be the beneficiary of estate funds from this process, it must act now to cultivate those relationships. The WIN Foundation will be establishing a project focused on this in our Advancement Committee.
On the other hand, this may present an opportunity to expand Wittenberg's academic offerings with two different constituencies: traditional and non-traditional students.
In the area of non-traditional students, WIN Foundation members have spoken with former Wittenberg non-traditional students in order to better understand the pros and cons of WItt's past efforts in that area. From that investigation, we have concluded that addressing this market with online courses (synchronous and asynchronous) would be best. Some offerings could be graduate-level programs aimed at early/mid-career adults, while other offerings could be aimed at people that are retired, near retirement, late career, or "stay at home" adults. It is also conceiveable that some offerings could be non-credit courses. These are not new ideas in the field of education, but they are things that Witt is either not doing now, or could do more of. The WIN Foundation could provide a venue for professors to create content for new courses at no cost to Wittenberg. Professors would be reimbursed by the Foundation through a royalty for their course (per student) and a fixed payment for teaching the course would come from Wittenberg.
As it relates to traditional students (rising high school students and transfers), we believe that enhancements could be made to Wittenberg's current Financial Planning minor (within the Business Department) that would accelerate student attainment of planning certifications (e.g., CFP) which typically prevent entry level employees at financial services companies from moving up the promotion ladder. This modified program could involved opportunities for paid internships in financial services companies or supporting Advancement efforts at Wittenberg. Having such an accelerated program would provide a differentiated program into Wittenberg's arsenal of majors and minors - a tool for attracting students and boosting enrollment.
If you are in the Financial Services industry, and you are not yet a member of the WIN Foundation, join today to help put this initiative together. If you are a possible non-traditional student, let us know what sort of course offerings would be appealing to you.
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