🌊 Buy, Borrow, Die

I’m not sure how much the great wealth transfer will mean for the economy. Wealth is just a number and not hard cash that can be spent. Some of that inheritance is going to get taxed, and then much of that is going to go into retirement spending and then end of life care.

Many of their houses are going to need repairs and get sold to “developers” who aren’t going to touch the place until they get the tax credits and grants that they want in order to fix up or demolish the house. Some houses will sit for years in this state.

As far as their stocks go, once people start cashing out, we may see the market stagnate as demand for stocks goes down.

First of all, shoutout to Nick from Michigan. I feel this so hard. 

Simple answer to why boomers got the loot…they produced…we consume. They invested…we spend. Now this is a bit of playing devils advocate cuz prices are friggin OUTRAGEOUS, but it’s because consumption is at an all time high. The number of whiners complaining about capitalism without mentioning consumption, is too damn high. People on socials in a full face of makeup, in clean clothes, surrounded by chatchkis recording their woes on a 1000$ device…begging for eradication of capitalism and how selfish boomers are. We can narrow down this mindset to much more recently…the lock down. The transfer of wealth during covid was the largest ever in human history. But even many of those who lucked out squandered their wealth on…consumption. 2020 also boasted some of the highest earnings in many industries cuz people kept buying shit. We have an obsession with stuff and money. People paying a mil for a home in the sticks and never interacting with their neighbors. People with zero domestic skills bitching about the rising cost of food easily produced at home. People making well into 6-figures gotta pay someone 500$/hour to change light covers. It’s a cycle of over consumptive behaviors mixed with lack of skill facilitated by the ease of convenience that has gone unchecked for a loooong time. So much so if you take the unnecessary things away, folks cry oppression.

This article was obviously written by a Gen Z. I see this all the time on FB...the bellyaching that they can't afford a home, that they can't live as good of a life as their parents. Well, there are better reasons than what this article states.

First of all, yes, everything was less expensive back then. But so were wages. I was educated and made $3.20 an hour in 1976. There were some huge differences for the Boomer generation, however. We all did without luxuries. We ate hamburger and hotdogs regularly, and were creative with hamburger but ate cheap. We never ate out and never would we have bought coffee or soft drinks. We didn't vacation and didn't go "out" for entertainment. We settled for apartments that were less desirable, we lived in "flats" with 1 or 2 bedrooms and one bathroom with 3 kids and 2 parents. We lived on a very tight budget and never used credit cards. We didn't have nice tvs and had one landline phone with no answering machines. We ate peanut butter and jelly sandwiches for lunch along with an apple and a couple of Oreo cookies. We lived without anything extra to save money for our downpayment on our first house. We were taught that way and by following these teachings, we were able to buy our first house YEARS after we were married. Our first house was bought after we were married for 7 years because that's how long it took to live cheap and save money for that downpayment. Nowadays people buy homes much younger and want a home equivalent to what they grew up in not understanding that the house they grew up in wasn't their parents' first home, but what they were able to afford after years of scrimping and saving. Nowadays a vacation is "expected" and eating out, entertainment and having more "stuff" is a priority. It wasn't back then for us. No one had a new car, we all had used cars. We didn't take on large car payments because a nice car wasn't a priority. We had used dishes and used furniture. We had basic  used appliances and had what we needed, not always what we wanted. Our priority was saving money and getting a home first and then slowly acquiring everything else. Wants and needs are very different but not to many people nowadays. If people ever get back to having only what they need, they will find themselves better off financially.

Surprised there's no mention of the impact of estate taxes on the wealth transfer. The implication in the article is that wealth is just handed over from one generation to the next. Not so for many families, including those with small businesses because of how the businesses are valued by the IRS. Also many boomers will use up many of their assets for medical and long term care.