Affluent Canadians—those with investible assets of $1 million or more—plan on leaving, on average, 30% of their wealth to their children, according to a study.
The BMO study finds they plan to divide the rest of their estates as follows: spouse or partner (60%), other family members (4%), charities (3%), and a board or company (3%).
Additionally, almost 80% of high net worth Canadians feel that their children are ready to manage their inherited wealth. This sentiment could perhaps be attributed to educational efforts; 65% reported that they spend time educating their kids about money matters.
“Affluent Canadians value leaving a legacy and will be passing on a significant portion of their wealth to their offspring,” says Yannick Archambault, vice-president and chief operating officer of BMO Harris Private Banking. “However, with wealth comes complexity.”
According to the study, just 26% of high net worth Canadians feel that their children will be better off financially than them. Forty-one percent think that their children will be worse off than them, with 60% believing that this will be because of the state of the economy.
“Many are still feeling the effects of the 2008 recession, so it’s not too surprising that people may not be feeling upbeat about what the future has in store for their children,” Archambault adds.
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