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Multi-Generational Collaboration

By Evan Hewitt, CFP®

One increasingly frequent conversation with our clients who have young adult children is: “I have more than I need, and I don’t want to wait for my will reading to help out my kids.”

In the past, families often clearly separated their finances—”We have ours, and you have yours.” Each generation lived separately. But now, there seems to be a sort of wall between Gen 1 and Gen 2 that continues to fall, and we’ve seen more creative and intimate approaches to intergenerational financial planning.

These conversations are delicate and require careful handling. As you can imagine, there are many financial and non-financial nuances involved.

That said, where there’s goodwill, there’s generally a way. We’ve helped many of our clients identify mutually agreeable ways to put their excess wealth to work, helping launch the next generation. This could involve anything from helping with down payments to pre-seeding a grandchild’s 529 account.

If you would like to explore this for your family, we welcome the conversation.

Cost of Long-Term Care: According to the 2024 U.S. Department of Health and Human Services, every day until 2030, 10,000 Baby Boomers will turn 65, and 7 out of 10 people will require long-term care in their lifetime.

The cost of this care is often a topic of family conversation at some point, and it can be confusing. This calculator gives an idea of what it could look like based on geographical location. If you are approaching these years or need to think about this for parents, please reach out. We’d love to help.

Insurance and Mortgages: Due to increased home losses due to natural disasters and rising home cost repairs, insurers have pushed big rate increases, according to a recent Wall Street Journal article. These increases change the math of homeownership. In September, 32% of the average single-family mortgage payment went to property taxes and home insurance, the highest rate ever for data going back to 2014, according to Intercontinental Exchange:

The analysis is based on borrowers who use escrow accounts to pay their taxes and insurance as part of their monthly mortgage payments. Nationwide, taxes and insurance make up more than half of the monthly mortgage payment for 9% of single-family homes (up from less than 4% at the end of 2014).

Kids and TikTok: On Friday, the Supreme Court heard arguments over whether TikTok can be banned in the U.S. later this month. The surrounding issues related to constitutional arguments pertaining to national security and free speech. While separate lawsuits were filed by 14 state Attorney Generals surrounding what they classify as the mental and social harm TikTok is to children, those will not be part of the Supreme Court hearings.

For those interested in the state briefings, you can find a summary of them here. The gist of the concerns are about the addictive nature of the platform which has led to a number of issues. It is a sobering read. Consider just this one example of how the algorithm works to push certain topics:

 

*The views expressed represent the opinions of Compass Ion Advisors, LLC, as of the date noted and are subject to change. These views are not intended as a forecast, a guarantee of future results, investment recommendation, or an offer to buy or sell any securities. The information provided is of a general nature and should not be construed as investment advice or to provide any investment, tax, financial, or legal advice or service to any person. The information contained has been compiled from sources deemed reliable, yet accuracy is not guaranteed.

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