Where Did the Inheritance Go? Long-Term Care and the Wealth Transfer Gap

The Inheritance Isn’t Showing Up the Way Families Expected. Here Is What That Means for New Jersey Families.

For years, financial planners and journalists have described the coming decades as the greatest wealth transfer in history. The premise is straightforward: Baby Boomers accumulated an enormous amount of wealth over their lifetimes, and eventually that wealth will pass to their children and grandchildren.

What the headline version of that story leaves out is the part where long-term care costs, retirement spending, taxes, and fees get their share first.

A recent Fortune article by business editor Nick Lichtenberg puts a precise and uncomfortable number on what families are actually likely to receive. According to Fortune’s reporting, Boomers currently hold roughly $93 trillion in assets. But only about $36 trillion of that is projected to actually reach Gen X and millennial heirs over the next 20 years, once the costs of living longer, spending in retirement, paying taxes, and covering care expenses are subtracted. That works out to approximately 39 cents on every dollar.

The rest is being consumed by the cost of aging.

You can read the full Fortune article here.

What the 39-cents figure actually represents

The Fortune piece frames its central story around a cultural moment: millennials declaring on social media that they will refuse to care for aging Boomer parents, while data shows they are already doing exactly that, quietly, unpaid, and often at significant personal cost. The Reddit thread the article references, originally written in response to warnings about a coming eldercare crisis, went viral again this summer as the first Boomers began turning 80. The comments are full of generational grievance. The Bureau of Labor Statistics data tells a different story about what is actually happening in American households.

But the financial figure at the center of the piece, 39 cents on the dollar, is what deserves the most attention for families in New Jersey and New York who are trying to understand what the next decade actually looks like for them.

That number is not the result of bad investments or poor saving habits. It is the result of people living longer than prior generations, spending more years managing chronic illness and cognitive decline, and relying on a long-term care system that is expensive, fragmented, and almost entirely without public subsidy for most middle-class families. As one financial advisor quoted in the Fortune piece put it, the house is usually the last asset left in retirement, and it often turns into a retirement emergency fund before it ever becomes the children’s inheritance.

That sentence deserves to sit for a moment. The family home, in many cases the single largest asset in an estate and the one most families assume will eventually pass to the next generation, is increasingly being spent on care before anyone inherits it.

Why this is a Medicaid planning story as much as a generational finance story

The Fortune article focuses on the caregiving burden and the shrinking inheritance. What it does not address is the planning gap that sits underneath both of those problems.

Long-term care costs in New Jersey are among the highest in the country. Nursing facility care regularly exceeds $12,000 to $14,000 per month. A two- to three-year stay, which is not unusual for someone managing dementia, Parkinson’s disease, or another progressive condition, can cost $300,000 to $500,000 or more. Those costs come from somewhere. For families without a plan, they come from savings, retirement accounts, investment portfolios, and ultimately the home.

Medicare does not cover custodial long-term care. Most middle-class families do not have long-term care insurance policies, and those that were purchased years ago often have coverage limits that fall well short of current costs. Medicaid, the program that does cover nursing facility care for eligible individuals, requires meeting strict financial criteria, and many families have far more in assets than those criteria allow without some form of planning.

The gap between what families expect, that Medicare will cover care, or that Medicaid is only for people with no money, and what is actually true, is where the 39-cents-on-the-dollar erosion happens. It is not inevitable. It is the predictable result of a planning conversation that was never had.

The millennial caregiving reality behind the numbers

The Fortune article draws on Population Reference Bureau data showing that the number of family caregivers assisting older adults grew by 32 percent between 2011 and 2022, rising from 18.2 million to 24.1 million. Adult children remain the single largest category of family caregiver in America. The cultural narrative of millennials refusing to step up does not match the data on what they are actually doing.

What the data does show is that they are doing it without support, without compensation, and often at significant cost to their own financial stability. The article cites research showing that nearly one in five employed caregivers leaves the workforce entirely to provide care, while four in ten reduce their working hours. The financial impact on the caregiver extends beyond the immediate loss of income. It affects retirement savings, Social Security benefits, and long-term earning potential in ways that compound over decades.

This is the hidden cost that the 39-cents-on-the-dollar figure does not fully capture. It accounts for what the parent’s assets spend on care. It does not account for what the adult child loses in earnings, career advancement, and retirement security while providing that care unpaid.

The families that end up on the better side of these statistics are almost always the ones who planned for long-term care as a financial reality before it became a family emergency.

Plan Well. Live Better.

At Milvidskiy Law Group, these are the conversations we have with families across New Jersey and New York every day. The 39-cents-on-the-dollar projection is an average. What changes the outcome for any individual family is planning that begins before a care need makes the options smaller.

If you read the Fortune article and recognized your own situation in it, that recognition is worth acting on. Learn more about how we approach Medicaid and long-term care planning for families across New Jersey and New York.

This article is for informational purposes only and does not constitute legal advice.