Who would be a millenial?

cells

lisyloo wrote: »

I am absolutely not convinced about this at all.
I'm 48 and may be up for first inheritance in the next 5 years.
However I might not because it's odd-on that it's going to get spent in care fees.
If I did get an inheritance I will have paid off my mortgage and thinking very much of retirement in my 50's so not terribly useful in terms of buying a house, raising a family i.e. when people need the money.

Of course not everyone's circumstances are the same, but in general as people live longer then the next generation will be approaching retirement and also more will get spent in care fees.

you need to think more generally.

If the stock of wealth is...oh I dont know say £10 trillion. Either that gets gifted or inherited or like you say maybe it has to be spent on care costs. But even if it is 'spent on care costs' That £10 trillion leaves the older generation and comes to the younger generation. It isn't destroyed.

Or think of it this way. Imagine there are just two people on an Island. A father and his son. The father owns a house and when he dies the son gets it. On the other hand the father may need 10 years of care and then dies and the house is again the kids. You may be thinking sure if the kid does the care work it works out but on average thats how it works. So although one individual father might not be able to pass down the house to his individual kid the care means that father passes the house down to some other kid who would be houseless had it not been for the care.

The house doesn't disappear the stock of wealth doesn't disappear there is just accounting entries

cells

kabayiri wrote: »

Productivity improvements generally mean fewer people acquiring the wealth. I don't know how that sits with the policy of growing the populace significantly over the last few decades.

Also, why should the new quality jobs head here? My wealthy Chinese friend makes a compelling case for South America being the new growth market. He might be wrong, but why should we assume Europe will be in growth?

thats as silly as asking 'why do you think a newly discovered technology will be available and used in Europe'

cells

MobileSaver wrote: »

Maybe if millennials worked a little harder and didn't have such a sense of entitlement they'd earn more than the previous generation?

They probably already do on a 'purchasing power parity basis'

They have easier safer jobs and will be able to physically keep working longer than the coal miner who started work at age 15 and died by age 60 assuming he survived the black lung cancer operation at age 40

lisyloo

Cornucopia wrote: »

But is this about you, though? Money spent on care fees is money that is being put back into the economy rather than being "hoarded".

Of course it's absolutely not about me and I have no issue with not getting an inheritance at all - in fact I've actively encouraged them to spend and enjoy it when they could and taken them on many holidays.
The money is not being "hoarded" in this case - the only asset they have is a flat that they both live in, which provides essential shelter.

Do you really call that "hoarding"? or did you just decide to make something up without knowing the circs?

lisyloo

That £10 trillion leaves the older generation and comes to the younger generation. It isn't destroyed.

The consumables used to keep the old person alive are entirely destroyed e.g. food, drugs, incontinence pants.
I'm not denying there is some profit from running a care home, so some businesses and some low paid workers get jobs.

On the other hand the father may need 10 years of care and then dies and the house is again the kids.

In the 2 people on the island scenario the son would look after the father as there would be no alternative.
In the UK in general the elderly would go into a home and their residence would be sold to pay for the care.
Different scenario.

The house doesn't disappear the stock of wealth doesn't disappear there is just accounting entries

There are big accounting entries that you seemt o be forgetting and pretending keeping very elderly people alive costs nothing.
There is expensive medical care, food, clothing, housing (buildings) etc. etc.
Some of that e.g. food is literally consumed and destroyed.

Are you really saying that the millennials will be fine because they'll all get a nice house in their 50's????

stator

cells wrote: »

Lots of parents gift wealth to their kids well before the kids are in their 60s. Not everyone waits until they die. Also grandparents gift to their grandchildren.

Not really. A lot of old people only have wealth in their houses and they stay in them until they die or move to a care home. If a care home their money evaporates.
So most working class people won't inherit anything at all until their parents die and many won't inherit anything at all. I'm not expecting anything.
The view from middle class suburbia may be completely different.

lisyloo

Also grandparents gift to their grandchildren.

My family were discussing this very recently.
Inheritance will go to the children (currently 50 and 56) - this is a working class background.
There were many points of view discussed, but ultimately it's the parents decision.
There's a very real chance of there being nothing left.

Cornucopia

There seems to be a lot of looking forward to the worst case scenario here (same with leaving the EU).

Money spent on old-age care does not "evaporate". It may not come to the next generation as individuals, but it will be being spent in the economy. The notion that money spent is "lost" is not good economics. What happens is that it spreads through the economy - providing employment and company profits amongst other things.

The physical infrastructure of an elderly relative's house is not lost, either. Its cash value may be gone, but it still physically exists as a house in the housing market, and is therefore part of the mass of housing available to younger people.

cells

stator wrote: »

Not really. A lot of old people only have wealth in their houses and they stay in them until they die or move to a care home. If a care home their money evaporates.
So most working class people won't inherit anything at all until their parents die and many won't inherit anything at all. I'm not expecting anything.
The view from middle class suburbia may be completely different.

well yes plenty will get nothing but plenty will get a lot. A lot of people who think they will get nothing also will. A lot of 'poorer folk' will marry into richer families knowingly or unknowingly.

We know there is a huge stock of wealth, for arguments sake £10 trillion and we know it gets passed down and we also know that in more cases than not it gets spread thinner. Using the goldsmith example again it went from £1.2 billion to £300m to likely £60m


Whatever your belief or views on inheritance the fact is its a huge amount, my estimate/guess is that somewhere in the region of £100-200 billion ANNUALLY is gifted or inherited. Such huge figures need to be taken into account in discussions about house price affordbility or if gen x is better of than Z

Cornucopia

lisyloo wrote: »

Of course it's absolutely not about me and I have no issue with not getting an inheritance at all - in fact I've actively encouraged them to spend and enjoy it when they could and taken them on many holidays.
The money is not being "hoarded" in this case - the only asset they have is a flat that they both live in, which provides essential shelter.

Indeed - so there may be inheritance, and there may not be. That is the reality for most people. Like you, I have told the older generation to spend it as they like.

The issue for this thread and every other one like it, though, is that people are talking about "Boomers" as a homogeneous group, whereas they are actually individual real people and (often) other people's parents. One thing we can be certain of - every moaning millenial had some parenting along the line.

Do you really call that "hoarding"? or did you just decide to make something up without knowing the circs?

Not me. "Hoarding" and "Hoarder" were used on page 1 without any real indication as to their meaning.

I don't consider wealth locked into one's own home to be hoarding, at all. But I get the impression some people do.