The "Baby Boomer" generation will pass approximately $3.2 trillion (yes, with T), on to the next generation, according to the RBC Wealth Transfer Report 2017. Only 30% of Baby Boomers have a full wealth transfer plan, and another 30% have no plan in place at all. According to those numbers, approximately $1 trillion is going to pass according to intestacy and subject to the full available taxation rules for assets. While the transfer of assets itself is significant issue - how it should be done, to whom, and in what amounts - perhaps the more pressing issue is the unexpected receipt of such assets by the next generation.
Found Money Mentality
Americans are not unique when it comes to the "Found Money" phenomenon. On average, if someone is not expecting to receive a sum of money, large or small, they don't tend to make wise decisions with that money. They go on vacation, by things they don't need, and substantially deviate from any savings or investment strategy they had prior to receiving the money. To put it plainly: they usually blow the money, rather than investing those funds and making them grow for themselves or their own children. It becomes a cycle. According to recent statistics, 1/3 of all inheritances are wasted within 3 years. Think about that for a second.
Structure Wealth Transfers
Using trusts or family LLCs can put structure around the asset succession process and allow for your beneficiaries to receive and benefit from your wealth without risking the "found money" mentality mentioned above. You can also ensure that your beneficiaries are mature enough to receive a benefit instead of dropping a lump sum of assets on them whenever your death occurs, and you can appoint a responsible and financially competent person to manage the assets in the meantime (trustee or manager).
Wealth Transfer Planning is for Everyone
This is not just a 1% problem. Whether you have $5 million or $50,000, you need to have a plan in place for the transfer of those assets. The plan for an individual will look different between $50,000 and $5 million, but the plan for both with put your wishes first and use your rules instead of the state's.