The Great Wealth Transfer: What Donors Need to Consider

HUNTSVILLE, Ala. (WAFF) - Over the next two decades, the United States will witness the largest transfer of wealth in history, with an estimated $84 trillion set to change hands. While much of the focus has been on heirs and beneficiaries, donors—those passing on their wealth—have critical decisions to make.

This article is part two of a three-part series on The Great Wealth Transfer, exploring how individuals can strategically plan for the largest wealth shift in U.S. history.

Financial advisor Jay McGowan from The Welch Group offers key considerations for estate owners as they navigate this historic shift.

Who Will Receive Your Wealth?

The first decision estate owners must make is who they want to receive their assets. According to McGowan, wealth can be transferred to:

• Family members – Children, grandchildren, or other relatives who stand to inherit personal and financial assets.
• Charities – Many individuals choose to support nonprofit organizations, universities, or religious institutions.
• Trusts – A trust can help ensure assets are distributed according to specific wishes, often offering tax benefits and protection from mismanagement.

“The choice of who inherits your wealth is personal,” McGowan explains. “It depends on your goals—whether you want to support loved ones, leave a charitable legacy, or structure a trust to preserve wealth for future generations.”

What Will You Pass On?

McGowan emphasizes that different types of assets are transferred in different ways, each with unique tax and financial implications. Some common assets include:

• Personal property – Family heirlooms, art, jewelry, and collectibles.
• Financial assets – Stocks, bonds, annuities, and retirement accounts.
• Real property – Homes, vacation properties, and land.

“It’s important to understand how each asset is taxed and transferred,” McGowan advises. “For example, an inherited IRA is taxed differently than a brokerage account or real estate, which can impact your heirs significantly.”

When Should You Transfer Assets?

One major consideration for donors is the timing of their wealth transfer. Some choose to pass on assets during their lifetime, while others opt to leave their wealth as an inheritance after death.

“I work with clients in their 60s, 70s, and 80s who are making these decisions,” McGowan says. “Some want to see their family enjoy their wealth now—perhaps funding a grandchild’s education or taking a once-in-a-lifetime family trip. Others prefer to hold onto their assets and pass them on after they pass away.”

How to Transfer Wealth Efficiently

Strategic planning is helpful to minimize tax burdens and maximize the value of the estate. Some key strategies include:

• Estate planning and beneficiary designations – Ensuring assets go to the intended recipients with minimal legal complications.
• Understanding tax implications – Different assets carry different tax consequences for heirs.
• Roth conversions – Converting traditional retirement accounts into Roth IRAs can create tax-free income for beneficiaries.
• Charitable gifts – Direct donations or donor-advised funds can provide tax advantages while supporting philanthropic goals.

“The goal is to reduce tax consequences for both yourself and your heirs,” McGowan explains. “For example, if you have multiple children, their combined tax burden on inherited assets could be substantial. Proper planning can help alleviate that.”

Be sure to tune into WAFF 48 News at 4:00 p.m. next Tuesday, March 4th, to learn more about how beneficiaries of The Great Wealth Transfer can plan ahead.

To learn more about The Welch Group, click here. (link to site)

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