There is an interesting new reality in the world today and we are only just figuring out how to respond to it. It’s a good reality, and a product of incredible advancements, inventions, and innovations. Yet it’s requiring us to rethink long-established habits and patterns. Or it should be, at least.
Here’s the reality I am thinking about: human beings are far wealthier than they have ever been and are, on average, living far longer than they ever have in the past. This is leaving vast amounts of wealth and power in the hands of people who are not merely senior citizens, but who are often well into their 80s or 90s. The opening paragraphs of the article “An Oligarchy of Old People” in The Atlantic describe this.
Donald Trump will soon be an octogenarian, and is president in part because the preceding octogenarian, Joe Biden, did not want to admit his senescence. The median senator is 65, and the oldest, 92-year-old Chuck Grassley, has not ruled out running for reelection in 2028. The typical general-election voter is a spry 52, but in primary elections, which decide the majority of political contests, that number rises to 59. Half of all the money donated to political campaigns comes from Americans age 66 and older.
This provides lots to consider on the level of national leadership, and perhaps church and ministry leadership as well, something I may try to think through at another time.1 For now, though, my main interest is in the area of finances. Here’s how the article continues:
Although political gerontocracy has operated overtly, the rising economic power of the elderly has escaped much notice. Over the past 40 or so years, American wealth has grown ever more concentrated among the oldest generations. In 1989, Americans over age 55 held 56 percent of it; today they hold 74 percent. During that same period, the share of wealth held by Americans under 40 has shrunk by nearly half, from 12 to 6.6 percent. The color of money is now gray.
While independent adult life is beginning at roughly the same time as it always has—in the early 20s, when school is finished and full-time work begins—it is continuing much longer. In 1900, the average American could expect to die in their late 40s, in 1930 their late 50s, in 1950 their late 60s, and today in their late 70s. The most recent projections suggest that within the next two or three decades, life expectancy may rise well into the 80s. What humanity has achieved over the past century is nothing short of remarkable.
Just a century ago, and for all the many millennia before then, the average human being had a short childhood and a relatively short old age that together bookended a 25 to 30-year career. The period that fell between the end of work and the onset of death was typically quite brief. Today, though, that period can easily last for many decades. For an entire generation of Westerners, the dream was to work hard for 30 years and then retire at 55 or 60. Many did so, expecting to then enjoy 15 or 20 years of retirement living. Yet many have lived far longer than they would have guessed and have now been retired for more years than they ever worked. Because of savings, pensions, inheritances, rising real estate values, and savvy investments, many have as much wealth now as they did on the day they walked away from the workplace. And good for them, truly! (Of course, I need to acknowledge that not everybody has been able to accumulate such wealth, so even if this subject matter is common, it is by no means universal.)
Here is what I find especially interesting: While lifespans have increased dramatically, our traditions for passing wealth through the generations have remained relatively static. In the early 1900s, when the average person died in their 40s or 50s, a man would most often be leaving an inheritance to his children when they were quite young. They were probably still in the years of grinding and building—the stretch of life when they had not yet reached their peak earnings, but when expenses were elevated as they bought and paid for a home, raised and educated children, built a business, worked their way up the corporate ladder, and so on. An inheritance came to them at the period in life when they needed it the most and when it would do them the most good.
Today, though, that same man may not die until he is well into his 80s or even 90s, which means his children may already be in their 60s or 70s when they receive an inheritance. In many cases, they will have already passed through the most difficult life stages and already stored up wealth of their own. Most of them will presumably add that inherited wealth to their own accumulated wealth, then pass it down a generation when they themselves are 80, 90, or even 100. It is not hard to imagine ever-growing sums of money being passed from one elderly generation to another, with a lot of that money never accomplishing much other than offering an ever-increasing sense of security.
At the same time that this is happening, economic realities in the West are rapidly shifting, so that it seems harder for young adults to get ahead today than it was for Boomers or Gen X. Inflation, taxation, and healthcare have been taking a greater chunk out of earnings, and housing costs—especially in cities—have increased five- or ten-fold in just a generation. Every trip to the grocery store and every purchase of a car makes us realize that all of life’s necessities have spiked. And just as economic realities have shifted, so have generational values, so that Gen Z is placing a greater premium on work-life balance, meaning they may be unwilling to grind out the 50- or 60-hour workweeks that were so familiar to their parents and grandparents.
So how do we think about all of this and respond to it? I have a couple of suggested approaches. And to be clear, I am not speaking to the last generation of retirees, or passing judgment on them in any way. I am speaking to the next one—to the people who will be retiring in the decades ahead, and who need to begin thinking and planning now for the legacy we will leave to our children, should the Lord prosper us.
The first approach is to consider whether the Bible actually says it is wise or necessary to leave a financial inheritance to our descendants. We tend to take it for granted that this is our duty, but Randy Alcorn argues that the Bible is far more concerned with a spiritual inheritance than a monetary one. He suggests we may have read passages about leaving an inheritance to our children’s children through modern Western eyes and missed the Bible’s greater concern. If this is the case, then the ideal financial plan might be to do our best to ensure we have stored enough wealth to meet our needs until we die, and then leave the bulk of our remaining estate to church, ministry, or other distinctly Kingdom-advancing work. This would be leaving our wealth to what matters most to God.
A second option is a “generations-together approach” in which we soften the independence and autonomy of the generations so they work together financially. This is not so much an innovation as it is the recovery of an approach the West diverged from a few generations ago, and an appreciation of one that still exists in many places in the world. According to it, the older generations strategically reduce their wealth before they die in order to help the younger generation grow and stabilize theirs, thus providing money to them when it will be most meaningful. This could be through grandparents paying some or all of the tuition for their grandchildren’s education, or providing a regular stipend to enable one of their children to work only part-time and thereby homeschool the grandchildren. It could be through covering a few regular expenses like housing or cars, or through funding a business startup. For many people, a dollar given to them in their 20s or 30s will have far more benefit than five dollars given to them in their 50s and maybe a hundred or even a thousand dollars given to them in their 60s. If there is an inheritance at the end, it could mean skipping a generation and leaving it to grandchildren or even great-grandchildren (in the form of a trust if that’s considered wise or necessary).
Of course, these two approaches can be perfectly complementary. Though Alcorn advocates giving away the majority of an estate, he also says, “Wise parents can leave enough to their children and grandchildren to be helpful without leaving them so much as to hurt them.” And just as parents can leave an inheritance, they can provide an ongoing “pre-inheritance.” They may need to be careful that they are not unwisely generous, thus potentially making their children or grandchildren lazy, entitled, or dependent. They may need to be careful that they are not so generous that they end up destitute before they die. They will need to prayerfully consider how much to apportion to family and ministry, and when to do so.
But whatever the case, the reality is that the traditional Western system seems ripe for an overhaul. As Christians, we are charged by God to be faithful stewards of our wealth, and I fear many of us have a plan that will pass money from those who no longer need it (because they have died) to those who no longer need it (because they are already well established). There are a host of ways to steward money poorly, but surely one of the worst is to bury it in stocks, bonds, and mutual funds that may grow, but never get deployed in such a way that they are a blessing to others. Whatever else we do with our money, whether it is much or little, let us at least consider how we can use it to best serve God’s purposes. Let’s at least pray that God would show us how to be faithful stewards of what he has assigned to us.
- Though if you are interested, Aaron Renn has done some good writing on the subject. See, for example, The Gerontocracy Rolls On and The Boomer Paradox. ↩︎
