Alliance of Community Foundations Releases Transfer of Wealth Study

Missouri Transfer of Wealth Study from CF Ozarks on Vimeo.

The CFO joined with other community foundations across Missouri today to release “Wealth in Missouri and its Counties,” a study that shows the upcoming transfer of wealth that will occur here over the next 10-50 years.

In just the next 10 years, Ozarks members of the “greatest generation” and the first wave of the baby boomers that followed will transfer an estimated $47.2 billion of accumulated wealth to their heirs and others. For Missouri as a whole, that transfer of wealth will reach $134 billion. Over 50 years, that amount increases to a staggering $565 billion for the Ozarks and $1.5 trillion for Missouri as a whole.

The Alliance of Missouri Community Foundations partnered with the U.S. Department of Agriculture for a grant to commission the study by the Center for Rural Entrepreneurship in Lincoln, Neb.

For the complete study, including results for each county in Missouri, click here.

This nationwide trend is considered the largest-ever transfer of wealth between generations in the history of the United States. It’s the result of the “greatest generation” returning from World War II to rebuild America and, in the process, accumulate wealth that is being passed down through succeeding generations.

The goal of the Alliance is to encourage donors to consider a “5 percent solution” by including community-based philanthropic interests as 5 percent of their estate planning. In the Ozarks, that would capture $2.3 billion over the 10-year period, which would create $118 million a year in charitable resources using a 5 percent payout per year.

This emphasis on capturing this one-time transfer of wealth opportunity is significant for several reason. As smaller towns, in particular, lose population when young adults move away, they also may lose these potential assets because the children likely to receive the inheritances have demonstrated vastly different saving and spending habits.

John Gray, a credit review specialist for U.S. Bank in Springfield, recounted how the Arthur G. Tesar scholarship he received enabled him to become the first member of his Norwood family to graduate from college. He credited the scholarship, a $5,000 four-year renewable award, with allowing him to pursue his life’s goals. Although, he initially moved to North Carolina after he graduated, he decided to return to the Ozarks to continue his career in banking.

Former Springfield City Manager Tom Finnie said his estate planning includes long-term support for a dogwood garden established at Nathanael Greene Park in honor of his late wife, Kay. He wants to assure her legacy and the future sustainability of the garden by formalizing his support as part of his estate planning.

These types of philanthropic resources also are increasingly important as communities face cutbacks in state and federal resources and other types of public financing. Philanthropy is supporting communities in areas such as education, recreation, natural resource preservation, quality of life amenities like gardens or arts and culture, access to health care, and food insecurity.

“If we don’t use this historic opportunity to encourage the people who built our communities to help sustain them for the generations that follow, we stand to lose resources that will never be replaced,” CFO President Brian Fogle said. “Keeping wealth achieved in the Ozarks for the future benefit of the Ozarks fits well with our culture of self reliance.”