I have a ton of thoughts on all this, but I don’t want to get extremely far off the rails before I even really start talking, so … let me begin with a story, which tends to center me.
I grew up on the Upper East Side of Manhattan. As with any place, there are rich people there; there might be more rich people on the UES than in most places, though. I don’t necessarily have a ton of friends from my time on the UES, and my parents’ friends aren’t necessarily the most affluent people in the world (I probably know more of those kinds of people via my in-laws, actually), but I know a couple of people with “very decent” to “big” money. In one of those examples, the grandparent level of the family took the entire family — their kids, the grandkids, etc. — to Italy for two weeks. They predominantly stayed in top villas and toured a bunch of famous places, some at a private level. I don’t know a ton about money, but you assume 18 or so people — with airfare and different villas and different tours — that’s some money, right? It costs money to do all that. The grandparent level paid for everything; they’re both retired.
These people have good money and good investments, but they’re not even millionaires, you know? So when you take a trip like that, it cuts into the available “nest egg” for that next generation. That generation is getting a great experience — lifetime memories of their parents, along with their own children, in a magical country at a luxury level — and that’s a very tangible thing. When their parents die, which will happen (it happens to all of us, sadly), those memories will live on forever. At the funeral, people will constantly reference those memories. (I’ve seen this happen.)
I’m not talking about the absurdly-rich here — for them, this two-week jaunt to Italy isn’t a dent in the nest egg — but if you’re talking about a standard upper middle-class family doing something like this, well, then you’re almost trading the notion of inheritance for the notion of experience. If that starts happening en masse, is there a societal shift that might follow?
I started writing this post because right now I actually work in the travel industry, and this morning I went and co-moderated a panel on “millennials and travel.” I can’t really get that deep into what happened on the panel because some of it is proprietary to the work I do at my main job, but it was interesting enough to get me thinking about this whole topic more broadly.
So think about it like this: you’re in your 70s, you’re pretty successful, and you have a decent wad of cash saved up somewhere. You know that you’ve heard your entire life that you “can’t take it with you,” and you forego travel and experiences back in the day as you raised a family, bought a house, and worked. In many ways, this is the true American Way: nose to the grindstone, do the path, forget the vacation days, and back-end the experiences.
It’s supposed to go like that: Peak Earning, then Peak Experience.
OK, so let’s say you are that type of person. You have that money. You can save that money or diversify your investments so that something is there for your kids — that’s also somewhat The American Way — or you can spend that money, depleting it, but providing your family with experiences in the process. You have no idea what will happen when you pass away, so why not get the experiences now and include your loved ones in the process?
Like I said above, in the cases of strong generational wealth, this doesn’t matter.
But if an upper-middle class family takes 2 or 3 of these trips, and then the parents pass away, think about this: maybe the kids’ generation had some debts (credit card, grad school) and was looking for an infusion (inheritance/life insurance/etc.) to bolster that. But the hit isn’t coming — instead of the fiscal infusion, instead you’re left with stronger memories.
Does this change how we think about money and retirement and experiences and the middle class as a whole? It might.
This would line up with the whole, oft-quoted idea that millennials (children and grandchildren of Boomers) want “experiences,” which is making a whole mess of the resume and job search system. It would also line up with the idea that, based on how the travel industry has evolved, “we’re all basically Boomers now.”
This is definitely not really a topic that has any SEO credibility — I doubt anyone is out there Googling “Will my parents leave me experiences instead of money?” — but it’s interesting to think about what could happen from a cultural shift perspective if you start to see more and more of this.
I for one would always vote for experiences over inheritance.
I think I would too.