Baby boomers rated keeping their family's legacy going through stories more important than ownership of their personal possessions or receiving a financial inheritance, based on a new survey released by the Allianz Life Insurance Company of North America.
The 2012 Allianz Life Insurance Company of North America Allianz Life American Legacies PulseStudy -- a follow up to an Allianz Life study conducted in 2005 -- reaffirms that baby boomers and their parents are more concerned about family stories being passed down than on their material possessions or being awarded an inheritance.
An estimated 86 percent of boomers age 47 to 66 and 74 percent of elders age 72 and over agree that family stories are the most important aspect of their legacy, ahead of personal possessions (64 percent for boomers, 58 percent for elders) and the expectation of an inheritance for financial well-being (9 percent for boomers; 14 percent for elders), according to the Allianz study.
Allianz officials said this year's study essentially echoes the findings of Allianz Life's initial 2005 study in which an estimated 77 percent of both boomers and elders cited the importance of family values and life lessons as the most important part of a legacy.
Allianz's first study also found that an estimated 39 percent of elders believed that it was very important for them to pass on a financial inheritance to their children, but only 10 percent of the heirs judged receiving money or real estate from their parents to be very important.
By contrast, an estimated 77 percent of the children, all part of the baby boom generation, said receiving their parents' values and life lessons were very important to them.
Boomers and elders, according to the 2012 survey, also still agree that inheritance is not "owed." Only 4 percent said they felt they were "owed an inheritance" -- the same percentage as in 2005. At the same time, the number of elders who feel they owe their children an inheritance actually went down, from 22 percent in 2005 to 14 percent today.
However, that 8 percent drop may represent elders' greater concern about needing to use more of their savings to cover ever increasing living expenses since 2005.
"Our American Legacies Study found that people feel the same way they do about legacy transfer as they did prior to the market volatility we've experienced in recent years," said Katie Libbe, vice president of consumer insights for Allianz Life. "Although they're not concerned about legacy transfer with their parents, it's important that boomers invest more into their own legacy planning to ensure a better future for their heirs."
Although they agree on what part of legacy transfer is most valuable, boomers and their parents are not as in-sync on actually doing the work of legacy planning. The 2012 American Legacies Pulse Study revealed that elders are generally prepared when it comes to legacy planning and have also initiated conversations with their children on the topic.
An estimated 75 percent of elders have obtained professional assistance, such as a lawyer, financial professional, accountant or estate planner in planning their inheritance and 79 percent have had some type of in-depth discussion with their children about legacy planning.
Boomers are lagging behind in this area with less than half obtaining professional legacy planning assistance and nearly 50 percent never initiating a conversation with their own children about inheritance issues. Furthermore, one-in-four boomers have not planned their inheritance compared to 1 in 20 elders.
In 2005, boomers and their parents cited "honest & trustworthy" as a financial advisor's most desired characteristic (74 percent of boomers; 67 percent of elders). The response was followed closely by "explains things in an easy to understand way" (66 and 56 percent) and "good listener" (58 and 46 percent).
Finding that advisor who is "honest & trustworthy" is still at top of the priority list among boomers and elders, and has actually increased in importance with 89 percent of boomers and 91 percent of elders deeming it as a key requirement, Libbe said. "It would appear that turmoil in markets makes 'trust' more highly valued."
Today's boomers and elders also indicated they expect a higher level of "financial acumen" in their financial advisor. In 2005, 51 percent of boomers and 43 percent of elders cited the importance of their financial professional's ability to "help minimize taxes" and less than half of both groups (42 percent of boomers and 35 percent of elders) required that their financial professional be able to "help maximize the long-term value" of the inheritance.
Today, those skills are more highly valued with 75 percent of boomers and 70 percent of elders citing "help minimize taxes" and more than half of both groups (60 percent of boomers and 55 percent of elders) indicating "to help maximize the long-term value" of the inheritance.
The 2012 American Legacies Pulse Study was conducted online by SNG Research Corporation from Jan. 12-19 and consisted of an estimated 2,007 surveys - -1,000 with respondents age 44 to 67 and 1,007 with respondents age 72 and over. Libbe said respondents' annual incomes varied broadly.