The greatest wealth transfer in human history is coming

It’s the greatest migration of wealth ever to hit humanity: The unprecedented flood of money, four times the size of the US gross domestic product, that will be passed along to a younger generation over the next half-century.

Fueled by rising asset prices worldwide and entrepreneurship, America’s multimillionaire and billionaire baby boomers have embarked on an unprecedented $59 trillion transfer of their fortunes, according to researchers.

The cream of America’s 1 percent have already started spreading their money around like confetti to charities, foundations, trusts — and to their Gen X and millennial heirs.

“The numbers are staggering,” said Robert Maquat, who covers the New York metro market as a senior wealth adviser at People’s United Bank. “We’ve seen productivity gains in America and rising asset prices contribute to this phenomenon. The stock market bottomed out in March 2009, and since then we’ve had a 200 percent appreciation in equities. Assets like commercial real estate have also gone up rather dramatically.”

Maquat advises older Americans on how to transfer their fortunes tax efficiently.

He sees the numbers growing. “As a matter of fact, two days ago I was in New York with one of our clients who has a foundation about 5 years old and with in excess of $100 million,” he said. “His kids are in their late 20s and 30s and they get a kind of windfall and responsibility and are able to do some good for society.”

A new study by the Center on Wealth and Philanthropy (CWP) at Boston College estimates that nearly $60 trillion in US wealth will change hands over the next 55 years. And that excludes the nearly $20 trillion in charitable contributions by generous Americans.

About $5.6 trillion of the nearly $60 trillion will be clawed back by Uncle Sam in estate taxes.

The massive haul will be shifted from 93.6 million American estates through 2061 — the largest wealth transfer in American history.

“No question that the run-up in stocks and appreciation in property has played a role. We see it all the time, clients planning their estates before passing it on to their family,” said Howard Klein, head of the trusts and estate practice group at Citrin Cooperman, who recently handled an estate valued at $80 million. “We try to help them achieve their goals.”

The astonishing scale of the pending transfers has caught some analysts by surprise. After all, the financial crisis of 2007 and subsequent Great Recession crushed household assets.

“This wealth arose from the unique conditions of post-­World War II economic growth, productivity gains from immigrants and women entering the workforce, and a mindset of saving and investing,” said John Havens, senior research associate at CWP.

Not surprisingly, estate and wealth planning is a huge business. It’s practically a full-time occupation for some wealthy families faced with how to preserve and pass on their wealth — and also minimize taxes, according to Klein.

That came into public view recently when it was reported how Hillary and Bill Clinton have adopted strategies to avoid paying estate taxes on their wealth. That’s despite having long supported the federal estate tax on inherited wealth that can hit as high as 40 percent.

The Clintons are worth from $5.2 million to $25.2 million, according to financial disclosures. “Of course, you’ll never pay any estate taxes if you do one of two things — spend all your money in your lifetime, or leave it to charity,” said Klein.