Inheritance boom on the way with $385 million to be passed down in WA every week for 20 years

The greatest transfer of wealth in Australian history will begin over the next couple of years as baby boomers start reaching the end of their life expectancy. Research by property expert Gavin Hegney reveals WA babyboomers — born between 1946 and 1964 — are set to pass on $20 billion a year for the next 25 years. That equates to $385 million a week. It comes the oldest boomers prepare to turn 80 in 2026 — which ABS data shows is the decade in which people are most likely to die, with nearly a third of all Australian deaths occurring among octogenarians. The demographic changes will create more fluidity in the economy as homes are sold, and inheritances spent on cars, holidays and education. “The biggest part of their wealth is in their homes,” Mr Hegney said. “It could be that the big homes have already been sold, and baby boomers have moved into a retirement home or a villa. “But over the next few years we can expect to see much more of these old family homes put on the market.” Mr Hegney said Australian babyboomers have about $10 trillion in wealth, through property, stocks, shares and commercial businesses. Using the conservative assumption that boomers will have already spent half that wealth by the time they pass on, an anticipated $5 trillion will be passed on to their children and grandchildren over 25 years, about $200 billion each year nationally. WA’s share of the baby boomer wealth is equivalent to about 10 per cent of that. The amount the average person is likely to inherit is unknown, but Mr Hegney pointed to UBS research which calculates the average adult in Australia has $546,000 in wealth. This means people from single-child families stand to inherit more than $1m from their two parents. Mr Hegney said the wealth is tax-free for recipients with Australia one of the last countries not to impose an inheritance tax. While politicians were unlikely risk the backlash of subjecting the family home to an inheritance tax, he said there was a risk they may seek to get a slice of the wealth by taxing unused superannuation.