Author: Vishesh Raisinghani

President Donald Trump’s so-called “big, beautiful bill” just became law and has unleashed far-reaching impacts that both supporters and critics are scrambling to unpack.

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The 940-page legislative document touches on everything from immigration to healthcare, but it’s the modifications to the tax code that could be most noteworthy if you’re over a certain age.

Here’s why these new rules are a big deal for American seniors across the income spectrum, and why the next four years are a crucial window for you to adjust your tax plans accordingly.

Temporary tax deductions

Older Americans who rely on fixed incomes and are struggling with the cost-of-living crisis can expect some financial relief from this bill’s new tax credits and deductions.

Those aged 65 and above can now claim an additional tax deduction of $2,000 for single filers or $1,600 for each partner filing jointly. This deduction is on top of the standard deduction that is available to all taxpayers who don’t itemize their tax filings.

This seniors deduction is available even to those who itemize, unlike the standard deduction.

To qualify, individual taxpayers who earn up to $75,000 or couples who earn a combined income up to $150,000 can claim the full bonus deduction. The amount of deduction is gradually phased out at higher income levels and is fully phased out for anyone earning over $175,000 individually or $250,000 jointly.

Besides this bonus, many seniors could also benefit from other deductions included in the bill.

Auto loan borrowers, for instance, can deduct up to $10,000 in car loan interest payments if they meet certain eligibility criteria, and the amount of state and local tax (SALT) payments people can deduct from their federal taxes has been raised from $10,000 to $40,000.

Altogether, many seniors, especially those with auto loans or living in high-tax states, may see a lighter tax bill as a result of this new legislation.

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However, it is worth noting that several of these deductions have expiry dates. The SALT deduction is set to revert to $10,000 in 2030, while the auto loan interest deduction only applies to purchases in 2025, 2026, 2027 and 2028.

As for the bonus deduction for Americans ages 65 and over? That measure expires in the 2028 tax year.

In other words, many of these tax relief measures are attractive but limited and temporary. Seniors who can qualify may have a short window to take advantage of these temporary benefits.

Meanwhile, the One Big Beautiful Bill Act (OBBBA) makes big and permanent cuts to the social safety net, retirement benefits and medical assistance that could impact many seniors in negative ways over the long term.

Permanent cuts to the social safety net

The OBBBA includes funding cuts for some programs and tighter eligibility rules for others that could diminish the social safety net for many seniors.

Federal funding for the Supplemental Nutrition Assistance Program (SNAP), also known as food stamps, is set to be slashed and offloaded to state and local governments in October, 2027.

“To manage these new costs, states may be forced to restrict eligibility, limit benefits or withdraw from the program entirely, which would make it more difficult for eligible individuals to access food assistance,” wrote AARP chief advocacy and engagement officer Nancy LeaMond wrote in a June 29 letter to Senate leaders.

“Currently, many individuals are limited to three months of SNAP benefits every three years unless they are working for 20 hours per week or qualify for an exemption,” noted CNBC. “The new legislation will expand those requirements to individuals ages 55 through 64, parents of minor children ages 14 and up and veterans. It is unclear when those new rules go into effect.”

Over 11 million Americans over the age of 50 relied on SNAP as of 2023.

Meanwhile, the more than 9 million Medicaid recipients between the ages of 50 and 64 will face new work requirements to qualify for it as a result of this legislation, according to an AARP Public Policy Institute analysis.

“This big, beautiful bill — in terms of its impact on health care, on how physicians and hospitals are going to navigate the next few years — I think is the biggest immoral piece of health care legislation I’ve ever seen,” Arthur L. Caplan, PhD, a professor and founding head of the division of medical ethics at NYU Grossman School of Medicine, told Healio. “Just unethical, indefensible and tragic.”

These controversial measures could be why 53% of American adults strongly or somewhat oppose of Trump’s budget, according to a YouGov/Economist survey.

Nevertheless, since the bill has already passed, seniors have a short window of roughly four years to take advantage of temporary tax reliefs, credits and deductions to enhance their financial security independently.

Older Americans cannot afford to waste the next four years by neglecting these changes. Every dollar saved over this period could offset the long-term impacts of reduced federal support for medical and food benefits.

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This article provides information only and should not be construed as advice. It is provided without warranty of any kind.

When many people picture someone aged 16 to 24, they imagine a student buried in books or a young adult starting their first job. But for more than 4.3 million Gen Zers, neither is true — they’re not in school, not working, and increasingly unsure where they fit in.

That’s according to the latest report by Measure of America, a project of the Social Science Research Council. The study estimates that roughly 10.9% of young U.S. adults are NEET, or "not in Education, Employment, or Training."

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The report suggests that even a temporary withdrawal from society can have lasting consequences on a young person’s life.

“It’s associated with lower earnings, less education, worse health, and even less happiness in later adulthood,” the study says.

With nearly one in ten young people facing this grim future, some are now calling for a redesign of the education system to address the issue.

Worthless college degrees

Although college is traditionally seen as the path to building a bright future, political commentator Peter Hitchens argues that this belief no longer holds true.

“In many cases, young people have been sent off to universities for worthless degrees which have produced nothing for them at all,” said the author in a recent episode of his Alas Vine & Hitchens podcast. “And they would be much better off if they apprenticed to be plumbers or electricians. They would be able to look forward to a much more abundant and satisfying life.”

Indeed, nearly 52% of job postings in January 2024 did not require a formal college degree, according to Indeed’s Hiring Lab.

Meanwhile, 39% of firms in blue-collar sectors such as manufacturing and construction said they struggled to find employees in 2024, while 37% said the employees they hired were not suitable for the job, according to Angi.

This skills gap is likely to persist as young adults still see blue-collar work as less prestigious than white collar professions.

A Jobber study conducted in 2023 found that 74% of Americans between the ages of 18 and 20 perceive a stigma associated with choosing vocational school over a traditional four-year university.

Many are willing to go into debt to finance their white-collar ambitions. American households had accumulated $1.61 trillion in total student loan debt to finance some of these degrees, according to the New York Federal Reserve.

Crippling student debt for degrees that don’t lead to meaningful employment may explain why many young adults are disengaging from society. Fortunately, efforts are underway to turn the tide.

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Plugging the gap and changing perceptions

Shifting perceptions of blue-collar work and creating clearer pathways into trades and vocational careers could be key to addressing the NEET issue.

For instance, TV host Mike Rowe is giving away $2.5 million in scholarships this year to support young people pursuing skills training.

DEWALT, a leading manufacturer of power tools and equipment for construction and industrial use, is investing nearly $4 million through its "Grow the Trades" initiative.

The funding will be distributed as grants to 166 organizations across the U.S. and Canada that are dedicated to training the next generation of skilled tradespeople, including programs focused on skilling, reskilling and upskilling workers in areas such as carpentry, electrical work, HVAC and more.

Vocational training is already gaining traction. As of late 2024, 923,000 students had enrolled in a skilled trades school, up 13.6% from the previous year, according to the National Student Clearinghouse. If these trends continue, the skills gap — and the NEET crisis — could be gradually resolved.

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This article provides information only and should not be construed as advice. It is provided without warranty of any kind.

There’s simply so much wealth building advice out there that it’s easy to feel a little overwhelmed. If you ask ChatGPT "how to become a millionaire," you’re likely to get a flood of endless money hacks, conflicting advice and complex economic theory.

But you don’t need any of that to get into the seven-figure club. In fact, you can chart a course to the $1 million milestone by simply focusing on three essential numbers. Here’s a closer look at these crucial wealth building blocks.

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Net worth

You can’t make intentional progress if you don’t know where you currently sit. That’s why the most basic number you should be tracking on a consistent basis is your net worth.

Although calculating your net worth should be relatively easy, most Americans wouldn’t know where to start. Only 54% of those surveyed by Pew Research in 2023 said they knew a great deal or a fair amount about personal finances, which means nearly half of all adults could be struggling to measure their wealth and financial status accurately.

Fortunately, you don’t need sophisticated tools or AI to track your net worth. A simple spreadsheet that lists all of your assets and liabilities and calculates the difference between the two should suffice.

Savings Rate

If you’re trying to build wealth, tracking the amount of money you or your family save in any given year is an essential task. In fact, if you can monitor and raise your savings rate high enough to meet your savings goal, you can make your journey to millionaire status a lot shorter.

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Unfortunately, most American families are struggling to save much. At the end of May 2025, the personal savings rate was just 4.5%, according to the St.Louis Federal Reserve.

A family earning $100,000 a year would save just $4,500 a year at this pace and would take 222 years to get to $1 million in savings. But, by contrast, if the same family can raise their annual savings rate to 20%, it would take them just 50 years to get to that target.

This is why tracking and boosting your savings rate is so crucial for wealth building and why so many millionaires and billionaires are notoriously frugal.

Rate of return

The final ingredient in the wealth creation recipe is the rate of return on your savings.

Where you place your savings is just as important as how much you save. If you’re stacking $20,000 a year under a mattress, you will take several decades to get to millionaire status and by the time you get there, inflation would have drastically reduced the value of a million dollars anyway. Instead, if you invest in robust growth stocks, real estate, or fixed income opportunities, you could get to the seven-figure club a lot faster.

The Vanguard S&P 500 ETF, for example, has delivered an annualized return of 14.55% since its inception in 2010. If you assume a similar return going forward and invest $1,000 a month, you could reach the $1 million target in less than 20 years.

For someone with a diversified portfolio spread across bonds, real estate, stocks and cryptocurrency, it’s essential to measure the total combined return on all your assets every year to see if you’re making good progress towards your goal.

With these strategies in mind, you’re well on your way to joining the millionaire club.

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After 10 years of building up a career as a medical assistant in Atlanta, Georgia, Desiree Hill felt trapped. Not only was she earning just $38,094 a year, but the job was getting increasingly stressful.

“It was long hours,” she told CNBC Make It. “It was three hours of commuting in Atlanta traffic everyday and I never saw my children, so it really was taking a toll.”

Then came the breaking point: a divorce that forced her to find new ways to support her family.

But what started as a desperate side hustle — buying a beat-up $1,200 truck and teaching herself how to fix it via Google and YouTube — soon became something much bigger. That first flip netted her $4,000.

By 2020, she had repaired and flipped more than 38 cars, enough to convince her it was time to quit her day job and go all-in.

Today, the 39-year-old runs Crown’s Corner Mechanics, a full-service auto repair shop in Atlanta with five employees. Her business brought in $440,000 in revenue in 2024 and her journey has drawn more than 120,000 TikTok followers.

Want to follow in her footsteps? Here’s how she turned a DIY hustle into a six-figure business — and how you can too.

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Start with small experiments

Hill says she decided to try flipping cars because it was a relatively cheap side hustle. “I knew it was something I could spend a very small amount on and maybe, potentially, make a lot of profit,” she says.

Instead of spending thousands of dollars on professional training or buying a repair shop, Hill started with a small experiment — repairing a used truck she managed to purchase for just $1,200.

If you’re looking to switch your career or start your own business, low-cost experiments can help you test the waters and see if the new venture is the right fit, before overcommitting. If the experiment fails, you can walk away without any permanent damage to your financial situation.

Don’t quit your job right away

Although she made a sizable profit on her first flip, Desiree didn’t quit her medical assistant job right away. Instead, she kept building her skills for several years while also working full time.

“I came home, made dinner, got my children all set for bed… and then I went to the [garage] and started working on the vehicles,” she says. “Sometimes it lasts until 2-3 in the morning and then I get right back up at 6am and go to work.”

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Launching a business as a side hustle — dipping your toes, instead of diving in headfirst — is a smart, low-risk way to test the waters. And it’s more common than ever: nearly 52% of workers now report earning extra income from a side hustle, according to The Wall Street Journal.

Like Hill, if your side hustle starts to gain immense traction, you could consider leaving your job. But if it doesn’t, you could still benefit from the additional income.

Build an online presence

Hill says she initially started sharing her journey online just to track her progress, but it quickly gained more traction than she anticipated. Today, her 120,000 TikTok followers have become a major source of new customers.

In today’s economy, using digital marketing and social media as part of your business strategy is absolutely essential. Nearly 48% of consumers surveyed by Salesforce said they prefer using social platforms to learn about small businesses. With that in mind, spending some time and money to build up even a modest social presence could help your DIY business immensely and help fuel your side hustle’s future growth.

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This article provides information only and should not be construed as advice. It is provided without warranty of any kind.

Americans believe they need roughly $1.26 million to retire comfortably, according to Northwestern Mutual.

But many seniors are rapidly approaching retirement with far less than that figure.

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In fact, 20% of U.S. adults over the age of 50 have no retirement savings at all and 61% are worried about running out of cash after they stop working, according to the AARP.

This cash squeeze has pushed some older adults to adopt creative solutions to bolster their retirement income — including geographic arbitrage, or geoarbitrage.

Geoarbitrage means moving to regions with a lower cost of living while continuing to earn income from higher-cost areas, allowing you to save more or enhance your quality of life.

Here’s how you could apply this technique to add $100,000 or more to your nest egg.

Moving could bolster your retirement

Geoarbitrage is arguably more effective if you’re a homeowner. Selling off your primary residence and moving to a cheaper home in another part of the country could unlock tremendous cash for your retirement.

Fortunately, 61% of Baby Boomers (those currently aged 60 to 78) own their own home, according to Clever Real Estate.

Of those, 54% own their primary residence free and clear, which means they don’t have to worry about a mortgage, according to Redfin.

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Tapping into this home equity — by selling and moving out of the city or to a new state — could unlock a huge chunk of cash for retirees.

Given that the median home sells for $416,000, selling it and moving to a new home that is 25% less expensive could unlock nearly $100,000 in cash for the typical homeowner.

Geoarbitrage can also work for the 39% of Baby Boomers who don’t own homes. Excluding rent, the cost of living is more than 20% lower in Miami Beach than New York City, according to Numbeo.

That means you could move to Florida and potentially save tens of thousands every year over the course of your retired life.

Many are also considering moving to another country to secure a better retirement. According to a recent Harris Poll, nearly 26% of Baby Boomers are contemplating leaving the U.S. in the next two years, and 6% of them are serious about it. A better quality of life and easier retirement are their top priorities.

However, before you add geoarbitrage to your retirement plan, consider some of the drawbacks and caveats.

Caveats

Simply moving to another location may not be a silver bullet for your retirement woes. For instance, in some locations you might be considering geoarbitrage at the same time as most of your neighbors.

According to Zillow, there is an oversupply of 12.8 million empty-nester homes that are too big and not appealing to younger buyers.

Many of these are concentrated in cities like Pittsburgh, Buffalo, Cleveland, Detroit and New Orleans. If you live in any of these locations, unlocking your home equity might be more difficult.

In other words, the window of opportunity for your downsizing plans is rapidly shutting in certain locations.

The costs of selling and moving should also be considered if geoarbitrage is an element of your retirement plan. Brokerage fees, transport costs and renovations to your new home could all quickly eat into your nest egg.

You may also want to consider all the downsides and pitfalls of geoarbitrage that go beyond finances.

For instance, would you truly enjoy living in a state that is cheaper but much further away from your friends and family? Do you want to learn a new language in your senior years? Would you need to make compromises on medical care and assisted living if you decided to move?

Your time, savings and income are all limited in retirement, which means once you move you might not have much flexibility to reverse this decision. So if you plan to apply this strategy, proceed with caution.

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Money doesn’t have to be complicated — sign up for the free Moneywise newsletter for actionable finance tips and news you can use. Join now.

This article provides information only and should not be construed as advice. It is provided without warranty of any kind.

Not all college degrees are created equal — and some could actually leave you struggling financially.

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Recent research from the Federal Reserve Bank of New York based on 2023 data from the U.S. Census Bureau showed which majors lead to the lowest median incomes within five years of graduation (ages 22 to 27).

Here are the seven worst-paying college degrees as per their median early-career wages.

Do they cost more than they’re worth?

1. Foreign language (median salary: $40,000)

Mastering a foreign language may be a useful life skill, but it isn’t likely to be a lucrative one. The median early-career wage for foreign language degree holders is just $40,000 and the underemployment rate is a whopping 51.1%.

However, if you can combine your foreign language skills with other skills, you could land a relatively lucrative career as a foreign exchange trader, sommelier, diplomat or court interpreter, according to Indeed. Foreign diplomats can earn six-figure salaries.

2. General social sciences (median salary: $41,000)

Roughly 54.1% of graduates whose major was general social sciences are underemployed, according to the Fed.

Students are taught critical thinking and research skills in this multidisciplinary program, and they can usually choose concentrations.

Combining a versatile bachelor’s degree like this with a law degree is one way to boost your earning potential.

3. Performing arts (median salary: $41,900)

A degree in performing arts could be highly satisfying and enjoyable if you’re naturally artistic. However, having your talent recognized and monetizing art is as difficult as ever, which means your performing arts degree isn’t likely to lead to a fortune.

According to the Fed, graduates with a major in performing arts earn a median salary of $41,900 at the start of their career and the underemployment rate is a staggering 62.3%.

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4. Anthropology (median salary: $42,000)

With a 9.4% unemployment rate and 55.9% underemployment rate, it seems graduates who major in anthropology face a difficult job market.

Part of the reason for this difficult job market could be the fact that the organizations that need to hire anthropologists tend to be ones with limited resources, like non-profits, government agencies or academic institutions.

5. Early childhood education (median salary: $42,000)

Shaping young minds is an essential but overlooked and underappreciated skill. According to ZipRecruiter, the average hourly pay for an early childhood education teacher in the U.S. is $17 an hour.

One study found staff turnover is higher in early care and education (ECE) centers with lower wages. It also appears there’s little potential to grow your salary since the mid-career median wage is just $49,000.

6. Family and consumer sciences (median salary: $42,000)

This degree gives students an education in areas like nutrition, human development, family dynamics, interior design and home economics.

Many roles are found in education, community human service agencies and government agencies, which often come with low salaries and slow upward mobility.

7. General education (median salary: $42,000)

This degree gives students basic knowledge in a broad variety of subjects. According to Learn.org, it prepares them for both a wide range of entry-level careers and graduate-level study in a specific field. More then half of the holders of this degree in the adult working-age population also have a graduate degree.

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• This is how American car dealers use the ‘4-square method’ to make big profits off you — and how you can ensure you pay a fair price for all your vehicle costs

Money doesn’t have to be complicated — sign up for the free Moneywise newsletter for actionable finance tips and news you can use. Join now.

This article provides information only and should not be construed as advice. It is provided without warranty of any kind.

Many seniors across the country would consider their senior living community a safe haven. But for some, these properties turn out to be money traps right when their personal finances are most fragile.

Martha Bray, an 84-year-old Vietnam veteran, found herself trapped in such an unfortunate situation.

After 10 years of living at River Glen of St. Charles, a senior living community near Chicago that she describes as her “dream” home, the property was acquired by two investment companies that swiftly raised rents. She told NBC News that her monthly maintenance surged from $1,395 to $6,500 — a 365% increase.

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Unable to pay this extortionate rate, Bray ultimately decided to move out and receive only 75% of the $314,000 entry fee she paid to move in. Based on the property’s value at that time, she estimates her total loss at $100,000.

“I just want people to know not to believe a damn word anybody says,” she told NBC News.

“Your money is not safe.”

Indeed, many seniors are exposed to similar risks when they sign up for these seniors communities. Here’s why the industry’s image as a safe haven is looking increasingly shaky.

Private equity’s invasion

Factors that make seniors living facilities valuable to many families also make them attractive to investors. Elevated rents, recurring revenue and the nation’s aging population has made this a lucrative asset class for private equity firms.

According to the American Seniors Housing Association’s (ASHA) annual report on the industry, eight of the 50 largest operators in the U.S. senior housing space were private equity firms in 2024. And at least three had partnerships with real estate investment trusts (REITs).

Private equity’s influence could expand further in the years ahead. A survey of seniors housing trends by global real estate investment firm JLL, showed that 78% of institutional investors planned to expand their investments in senior care facilities. “Opportunities exist for investors to acquire high-quality real estate at below replacement cost,” says the 2025 report.

The impact of private equity ownership on residents of these facilities can be “significant and troubling,” according to the Center for Medicare Advocacy.

According to their analysis, properties taken over by one private equity firm in Iowa received lower overall and health inspection ratings, had fewer nursing staff, faced more abuse citations, incurred higher federal civil monetary penalties, and experienced more payment denials for new admissions

Put simply, some investment firms may be incentivized to put profits and shareholder returns above the interests of vulnerable seniors. If you or your loved ones live in such facilities or are considering moving in, you should take some steps to protect yourself.

Read more: You don’t have to be a millionaire to gain access to this $1B private real estate fund. In fact, you can get started with as little as $10 — here’s how

Protect yourself and your loved ones

There are several ways you and your family can reduce the risk of financial damages from seniors living arrangements.

Before you sign up, make sure you review the contract carefully and consider having the terms reviewed by an experienced lawyer. You should also try to find out which entity owns the property you or a loved one is considering.

There are minimal disclosure requirements for senior living property transactions, so it’s not easy to find out if a facility is owned by a private equity firm, but the Centers for Medicare & Medicaid Services (CMS) offers some limited information on its website about “affiliated entity performance” that could be helpful.

The CMS is also advocating for tighter regulations and more disclosures to bring transparency to the industry and help consumers find out who owns the properties they or their loved ones live in.

Last year, Democratic Senators Ed Markey and Elizabeth Warren introduced the Corporate Crimes Against Health Care Act, which aims to “root out corporate greed and private equity abuse in the health care system.”

If you believe the industry needs greater transparency and tighter protections, reach out to your local representative to encourage them to support the bill as it makes its way through Congress.

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Money doesn’t have to be complicated — sign up for the free Moneywise newsletter for actionable finance tips and news you can use. Join now.

This article provides information only and should not be construed as advice. It is provided without warranty of any kind.

It’s easy to think that once you crack six figures, you’re in the clear financially. But that assumption doesn’t always hold up. One-third of Americans earning over $200,000 a year say they’re still living paycheck-to-paycheck, according to a 2024 report by PYMNTS Intelligence.

Turns out wealth isn’t just about how much you earn, it’s about how you think and what you do with it.

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• Robert Kiyosaki warns of a ‘Greater Depression’ coming to the US — with millions of Americans going poor. But he says these 2 ‘easy-money’ assets will bring in ‘great wealth’. How to get in now
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Here are the top five ways wealthy people approach life, career and finances differently from the rest of us.

Subtle about their wealth

Contrary to popular belief, most multimillionaires are not cruising around in neon orange Lamborghinis or smoking cigars stashed in their Gucci bags. Instead, many wealthy Americans are trying to hide their wealth rather than flaunt it.

The “stealth wealth” or “quiet luxury” trend was highlighted in the 2024 National Millionaires Survey by Ramsey Solutions, which found that the top three car brands preferred by the wealthy were Toyota, Honda and Ford.

Simply put: wealthy Americans stay wealthy by resisting the urge to flaunt it.

Delayed gratification

Another major psychological difference between the rich and the poor is their ability to delay gratification.

In 2016, the National Bureau of Economic Research surveyed Americans over the age of 70 to see how much extra they’d need to wait a year for $100. Would they need $10 or $30? Those who required less compensation had greater patience and were better at delaying gratification, which was closely linked with their actual wealth and financial well-being.

In short, the ability to resist instant gratification is a key sign of future financial success.

Spend money to make money

Because they’re better at delaying gratification, wealthier Americans are more likely to invest their money rather than spend it.

A 2024 Gallup poll found that 31% of upper-income Americans believe stocks are the best investment. Only 7% said a savings account was a good investment.

In contrast, 20% of lower-income Americans chose savings accounts as the best investment, while just 14% preferred stocks.

This difference in strategy highlights a key mindset shift. Many lower-income households avoid risk and prefer safety, while wealthier households are more familiar with the potential rewards of riskier assets.

Read more: You don’t have to be a millionaire to gain access to this $1B private real estate fund. In fact, you can get started with as little as $10 — here’s how

Leverage debt skillfully

Debt isn’t good or bad — it’s all about how it’s used.

Lower-income households are more likely to rely on expensive forms of debt to cover daily spending. About 18% of households earning between $25,000 and $49,999 used buy-now-pay-later programs in 2023, compared to just 10% for those earning more than $100,000, according to the Federal Reserve.

Wealthier Americans tend to use debt for productive investments, such as real estate or business ventures. These assets have the potential to grow in value, while consumer goods like cars or electronics lose value over time.

Rethinking how you use debt could be a game-changer on your path to building wealth.

Pursue lifelong learning

In a constantly shifting economy, wealthier individuals know the key to preserving and growing wealth is to keep learning new skills and adapting to unexpected changes.

Whether it’s signing up for professional courses, attending workshops and expanding your horizons, could give your career the boost it needs to step up wealth creation.

What to read next

• Financial aid only funds about 27% of US college expenses — but savvy parents are using this 3-minute move to cover 100% of those costs
• Here are 5 ‘must have’ items that Americans (almost) always overpay for — and very quickly regret. How many are hurting you?
• How much cash do you plan to keep on hand after you retire? Here are 3 of the biggest reasons you’ll need a substantial stash of savings in retirement
• This is how American car dealers use the ‘4-square method’ to make big profits off you — and how you can ensure you pay a fair price for all your vehicle costs

Money doesn’t have to be complicated — sign up for the free Moneywise newsletter for actionable finance tips and news you can use. Join now.

This article provides information only and should not be construed as advice. It is provided without warranty of any kind.

The Great Wealth Transfer currently underway isn’t a solution for wealth inequality.

Instead, it’s likely to fuel a rising “dynasty” of young people with too much money and too little motivation to work, according to NYU professor Scott Galloway.

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• I’m 49 years old and have nothing saved for retirement — what should I do? Don’t panic. Here are 6 of the easiest ways you can catch up (and fast)
• Robert Kiyosaki warns of a ‘Greater Depression’ coming to the US — with millions of Americans going poor. But he says these 2 ‘easy-money’ assets will bring in ‘great wealth’. How to get in now
• Want an extra $1,300,000 when you retire? Dave Ramsey says this 7-step plan ‘works every single time’ to kill debt, get rich in America — and that ‘anyone’ can do it

“When you go to nice hotels, there are people in their 50s and 60s and you can tell it’s probably their money — and then there’s a whole raft of a younger generation with their parents’ credit cards,” says the entrepreneur and investor on a recent episode of his Prof G podcast. “What you have with dynastic wealth is you’re taking capital that should go back into the ecosystem and just creating these dynasties of unproductive, rich people.”

There are growing signs that the wealth gap could worsen as the transfer of assets from baby boomers to their children and grandchildren gains momentum.

However, Galloway believes there is some “good news” for younger Americans from modest-income families and a potential solution to the problem.

The good news

Baby boomers in America are expected to pass on between $70 trillion and $90 trillion in assets to their offspring, according to Cerulli Associates.

“The average age of the world’s billionaires is almost 69 right now. So this whole transition or wealth handover will start to accelerate,” said John Mathews, head of UBS’ Private Wealth Management division, in an interview with CNBC.

However, this massive wealth transfer isn’t distributed evenly across younger generations. A 2023 study published in the American Journal of Sociology found that the average 35-year-old millennial holds less wealth than the average boomer at the same age, but the top 10% of wealthiest millennials have 20% more wealth than the top 10% of boomers.

In other words, a growing intergenerational wealth divide emerging, and it’s likely to accelerate in the coming years.

However, Galloway says his time teaching at an Ivy League university has given him reason to be hopeful: “I know a lot of rich kids and I know a lot of kids who are not rich — and the levels of happiness are not greater among the rich kids.”

To him, that’s “good news” for young people trying to build wealth independently and find fulfilling careers. It’s also a wake-up call for policymakers looking to tackle the growing wealth gap.

Read more: You don’t have to be a millionaire to gain access to this $1B private real estate fund. In fact, you can get started with as little as $10 — here’s how

The $10 million solution

Galloway’s proposed fix for the widening wealth gap is what he calls “an exceptional inheritance tax.”

“Inheriting more than say $10 million bucks doesn’t increase the happiness of your kids,” he says, suggesting that lawmakers implement a significant inheritance tax above that threshold.

His recommendation isn’t far off from the current tax structure. For the 2025 tax year, estates worth more than $13.99 million are subject to a federal estate tax, according to the Internal Revenue Service (IRS).

The tax rate ranges from 18% to 40%, depending on the estate’s size, according to SmartAsset. Beneficiaries may also face additional estate and inheritance taxes on the state level, depending on where they live.

Still, there may be room to raise those rates. Japan currently has the highest inheritance tax in the developed world at 55%, followed by South Korea at 50%, according to PwC.

What to read next

• Financial aid only funds about 27% of US college expenses — but savvy parents are using this 3-minute move to cover 100% of those costs
• Here are 5 ‘must have’ items that Americans (almost) always overpay for — and very quickly regret. How many are hurting you?
• How much cash do you plan to keep on hand after you retire? Here are 3 of the biggest reasons you’ll need a substantial stash of savings in retirement
• This is how American car dealers use the ‘4-square method’ to make big profits off you — and how you can ensure you pay a fair price for all your vehicle costs

Money doesn’t have to be complicated — sign up for the free Moneywise newsletter for actionable finance tips and news you can use. Join now.

This article provides information only and should not be construed as advice. It is provided without warranty of any kind.