Hot off the heels of us finding out that some Canadians don’t hesitate to help their children buy homes, a new report has looked even closer at the lives of Canada’s wealthiest. Turns out, wealthy Canadians are gearing up to give their families an astounding $2.8 trillion this decade, in one way or another.
As evidenced by a new report from Investors Group, there are some 913,000 Canadian households with at least $1m in investable wealth, accounting for a whopping $4.2t. Open the definition up to ‘total assets’ (which includes cars, art, family businesses, and so on…), and that number balloons to $11.9t.
So, there’s a lot of cash floating around in Canada’s wealthiest families. And since a decent portion of these folks is over the age of 70, IG wanted to look at their plans over the next 8 years or so. What they found out made even our eyes pop.
That’s because this decade (2020-2030) wealthy Canadians are planning to give away some $2.8t to their families, in one way or another. First up- lifetime transfers and inter-household transfers.
Basically, these transfers cover two things- giving money away to children or others during one’s lifetime, and transferring money/assets to family members upon the death of a spouse/parent. Taken together, and these two kinds of transfers add up to almost $1.64 trillion.
Next are the intergenerational transfers, which occur when the surviving parent/spouse dies. At this time taxes and other financial issues are much more prominent, but even still, that’s another $1.207 trillion coming down the pipeline. Yeah, we’re talking serious amounts of cash here.
Now, you might be wondering how much actually goes to taxes and the like, and IG has that number, too! Across both categories, wealthy Canadians will be giving $139 billion to taxes, costs (of lawyers, planners, and so on…), and ‘third parties’. To put that into context, it’s just under 5% of literally trillions of dollars.
And here we are worried about paying rent! What’s the next plan? Find a wealthy family and see if they’re willing to adopt us, because that’s gotta be easier than actually reaching their level if we’re paying 25% or whatever it is a year on our less-than $100k/year jobs.
To check out the report in full, which is sure to have you feeling some feels, click right here.