What great wealth transfer?

Summary

Marketplace Morning Report — “What Great Wealth Transfer?”

Date: July 28, 2026
Host: Kimberly Adams
Main Guests: David Kelly (JP Morgan Asset Management), Federica Coco (Washington Post)
Episode Theme:
The episode explores the expected “great wealth transfer” from older to younger generations in America, examining why anticipated inheritances may be eroded by the rising costs of healthcare and eldercare. The show features a discussion about the Federal Reserve’s upcoming meeting and delves into a Washington Post investigation into the reality of inheritance amid growing elder care expenditures.

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Episode Overview

• Main Focus: The long-predicted transfer of wealth from Baby Boomers to their heirs is being threatened by rising out-of-pocket elder care costs, casting doubt on widely-cited projections of generational windfalls.
• Key Segments:
  1. Economic data’s influence on the Fed’s interest rate decision.
  2. A closer look at surging elder care expenses and why many seniors are unable to leave sizeable inheritances.
  3. Societal and policy implications of the changing financial landscape for aging Americans.

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Key Discussion Points & Insights

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1. Federal Reserve & Inflation (00:31–02:23)

Fed’s Rate Decision Amid Shifting Data

• Recent Economic Data:
  • Slowing job growth in June versus May
  • Inflation dropping faster than anticipated
• Implications for Fed Policy:
  • Suggests “a little less inflation pressure, a little less economic growth,” potentially decreasing chances for an imminent interest rate hike.
    • David Kelly (01:11):

      "We've seen a slowdown in job growth... and inflation come down a little faster... that should make them a little less likely to raise interest rates."

• Why 2% Inflation?
  • Historic target; 0% seen as too little inflation for economic functioning, but high inflation (4%-5%) impedes planning and monetary policy.
    • David Kelly (01:44):

      "The economy does better when there's a little inflation... what we want is a low and stable but positive inflation rate... And honestly I think 2% is about right."

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2. The “Great Wealth Transfer” Questioned (03:41–07:31)

Origins of the Investigation

• Motivation for Reporting:
  • Federica Coco was prompted by high assisted living costs—“between $6,000 to $12,000 a month”—to question prevailing narratives about generational wealth transfer.
    • Federica Coco (04:20):

      "It made me skeptical about whether this great wealth transfer was going to happen exactly as described."

Realities of Elderly Spending

• Average Out-of-Pocket Cost:
  • In the last 10 years of life, Americans spend an average of $19,000 out-of-pocket on care—a figure that doesn’t include room and board.
    • Federica Coco (04:52):

      "On average, every American in the last 10 years of their life spends $19,000 out of pocket on care. However, that number hides a few things..."

• Disparities by Income:
  • The burden falls hardest on the poor: among the bottom 20%, “40%... end up with zero money after the cost of care.” Room and board expenditures often go uncounted (04:52–05:29).

Personal Stories Illustrate the Crisis

• Case Study — Konrad Miles:
  • Retired with $200,000 in savings; only $30,000 left after care expenses, “less than three months... in his assisted living facility.”
    • Federica Coco (05:42):

      "He did everything right... his daughter said his savings were gone in a heartbeat."

    • Kimberly Adams (06:05):

      "Many of these people saved and prepared for retirement thinking that they were going to be able to leave something behind."

    • Federica Coco (06:14):

      "He had prepared both for his care and to leave something for his children. He apologized to them— that was the heart wrenching part for me."

Wealth-Building Implications

• Inheritance Now Mostly for the Wealthy:
  • Substantial inheritances occur primarily among the wealthiest.
    • Federica Coco (06:58):

      "The research... is that this is occurring really for those at the top. So it's only richer people that are qualifying for that inheritance. And... you might get... even more inequality."

• Consequences:
  • Rising elder care costs risk deepening wealth inequality across generations, reducing the role of inheritance as a vehicle for upward mobility.

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Notable Quotes & Memorable Moments

• On Fed Policy:
  • David Kelly (01:44):

    “The economy does better when there's a little inflation… what we want is a low and stable but positive inflation rate.”

• On the False Hope of the “Great Wealth Transfer”:
  • Federica Coco (04:20):

    “It made me skeptical about whether this great wealth transfer was going to happen exactly as described.”

• On the Pain of Lost Inheritance:
  • Federica Coco (06:14):

    “He apologized to them— that was the heart wrenching part for me.”

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Important Segment Timestamps

• 00:31 — Economic data influencing the Fed’s interest rate decision
• 01:39 — Why the Fed targets 2% inflation
• 03:41 — Introduction to Washington Post’s elder care and inheritance investigation
• 04:20 — Why the “wealth transfer” is not working as expected
• 04:52 — Average out-of-pocket elder care costs and disparities
• 05:42 — Personal story: Konrad Miles’ depleted savings
• 06:58 — The narrowing of inheritance and growing inequality

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Episode Tone

The conversation balances an accessible, explanatory approach with moments of empathy and concern, especially in discussing personal financial struggles. The tone is journalistic and factual but becomes poignant when detailing stories of loss and apology within families.

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In Summary

This episode sheds light on the challenges to the “great wealth transfer” narrative. Many elderly Americans are spending down their assets on care, often leaving little to nothing to heirs—except, as the data and stories show, among the wealthiest. For many, the promise of intergenerational financial security is being chipped away by soaring costs and insufficient policy responses, deepening existing inequalities. The brief but illuminating look at monetary policy and inflation sets the backdrop for a larger discussion about economic well-being, retirement, and the American Dream.

Transcript

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[Kimberly Adams]

We're getting lots of economic data this week from the government and companies just in time for a Fed meeting. From Marketplace in Washington, I'm Kimberly Adams. The Federal Reserve Open Market Committee is convening today and tomorrow. This marks the second meeting for Fed Chairman Kevin Warsh. And all eyes are on the decision from the Federal Reserve officials to hold or hike interest rates. Joining us to discuss is David Kelly, Chief Global Strategic Strategist at JP Morgan Asset Management. Good morning.

[David Kelly]

Good morning.

[Kimberly Adams]

How is the economic data we've received since the last FOMC meeting in mid June playing into the Fed's decision making process this week?

[David Kelly]

Well, I think it is important. We've seen a slowdown in job growth. So we saw slower job growth in June than than we'd seen in May and that's one thing. And then we also saw inflation come down a little faster in the June reading than than they had thought or we had thought. So overall the numbers show a little less inflation pressure, a little less economic growth than the Fed was seeing in the middle of June. And so that should make them a little less likely to raise interest rates.

[Kimberly Adams]

What is so special about the Fed's 2% target when it comes to inflation?

[David Kelly]

Well, it's just historically what they've targeted. We know that 0% is wrong because the economy doesn't work well if prices aren't rising at least a little. The economy does better when there's a little inflation. But obviously if you have higher inflation, 4%, 5%, then it's very hard to plan. And it also causes monetary policy to not be very effective. So what we want is a low and stable but positive inflation rate. And the Federal Reserve has traditionally called that 2%. And honestly I think 2% is about right.

[Kimberly Adams]

David Kelly is Chief Global Strategist at JP Morgan Asset Management. Thank you so much.

[David Kelly]

Anytime.

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[Kimberly Adams]

number of Americans 65 and older is expected to nearly double by 2060. And a new report from the Washington Post finds that at the same time, many aging Americans are draining the inheritances they had hoped to leave behind. Joining me to talk about this is Federica Coco. She's a data reporter on the business desk at the Washington Post. Federica, welcome.

[Optum Representative]

Welcome.

[Federica Coco]

Hi, Kimberly. Thanks for having me.

[Kimberly Adams]

I feel like your article's finding might surprise a lot of folks given how much we've heard about this massive wealth transfer that's supposed to be coming from baby boomers to younger generations. So what made you and your team dig into this?

[Federica Coco]

Well, I remember reading an article about this great wealth transfer, and at the same time, the Washington Post was working on an investigation on memory care. And that's when I found out that in some assisted living facilities, people were paying between 6 to $12,000 a month. And it made me skeptical about whether this great wealth transfer was going to happen exactly as described.

[Kimberly Adams]

And what does happen to folks in their final years, especially when it comes to their money?

[Federica Coco]

Well, there's one headline number which is that on average, every American in the last 10 years of their life spends $19,000 out of pocket on care. However, that number hides a few things. One is that that burden is much heavier for people who are poor. For the poorest, 20% of the population, 40% of them actually end up with zero money after the cost of care. And the second thing that this number hides is that this study does not actually record what people spend on room and board.

[Kimberly Adams]

You and your team have loads of examples in the story of people dealing with this issue. Can you walk me through one example that really demonstrated to you how these situations play out in real life.

[Federica Coco]

You know, one that really struck me is the case of Konrad Miles because he did everything right. You know, he saved $200,000 for his retirement years and his daughter said his savings were gone in a heartbeat. And when he died, he only had $30,000 left and that would have only covered less than three months of care in his assisted living facility.

[Kimberly Adams]

And I have to imagine many of these people saved and prepared for retirement thinking that they were going to be able to leave something behind.

[Federica Coco]

Yeah, exactly. And in fact, the case of Conrad Miles is one in point. He had saved for that. He had prepared both for his care and to leave something for his children. And he apolog to them that that was the heart wrenching part for me. But yeah, of course every parent wants to leave something behind for, for their child. And there's a number of, of policies in the system are making it very hard for those on middle and lower incomes.

[Kimberly Adams]

A lot of people see inheritances as a way for families to build wealth across generations. If so much more of that money is going towards elder care instead, what does that mean long term?

[Federica Coco]

Well, what we're seeing is the research that looks at the great transfer of wealth and inheritance is that this is occurring really for those at the top. So it's only richer people that are really qualifying for that inheritance. And what you might get is, you know, even more inequality.

[Kimberly Adams]

Federica Coco is a data reporter at the Washington Post. You can read her report on the rising costs of elder care and inheritance now. Federica, thank you so much for coming on.

[Federica Coco]

No, thank you. Thank you for having me.

[Kimberly Adams]

The team that works on the half hour Marketplace coming up later today is working hard on a show for you. Listen later to what my colleague Kai Rysdal has for you on many public radio stations [e-mail] In Washington, I'm Kimberly Adams with the Marketplace morning report. From APM American Public Media.

[Rima Grajs]

I'm Rima Grajs, host of the weekly Marketplace podcast. This is Uncomfortable. And this week on the show, Marketplace correspondents Kristen Schwab and Sabri Benishore helped me give advice about your workplace drama. Everything from pushy co workers to the politics of getting ahead, relationships at jobs

[Optum Representative]

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[Rima Grajs]

It makes a difference. Makes a difference. Be sure to listen to this Is Uncomfortable. Wherever you get your podcasts,