American Legacies Study

Results of the Allianz American Legacies Study, released in July 2005, point to the need to talk with people about legacy and end-of-life matters.

The purpose of the survey was to get a perspective on what people are thinking about inheritance in light of the fact that some $25 trillion is going to pass from generation to generation over the next two decades, says Mark Zesbaugh, president and CEO of Allianz Life Insurance Company of North America.

When focus groups were asked about the concept of inheritance, 'they clammed up.' But when asked to talk about 'legacy'—and what it means to them—the floodgates opened.— Mark Zesbaugh, Allianz Life

"As a financial services provider, we wanted to get some perspective on what both consumers and distributors were thinking about when it came to this transfer of wealth," he says. The study included more than 2,500 Baby Boomers and elders.

Initially, focus groups of Boomers and Boomers’ parents were asked about the concept of inheritance, but "they clammed up" and were reluctant to talk about it, Zesbaugh says. So researchers went back and asked them to talk about "legacy," and what it means to them. Then the floodgates opened. The focus groups started talking about more than the financial aspects of death.

"Because when people talk about inheritance, they think about money—money and death," says Zesbaugh. "And when they think about legacy, they think about life. How do I want to be remembered? What are the important things? What kind of legacy do I want to leave? What are my values and wishes that I want to have passed on? And what about my personal possessions?"

Findings showed that money wasn’t high on the list. In fact, passing along "values and life lessons" was overwhelmingly considered (by over 75 percent) the most important element of a legacy for both Baby Boomers and their parents’ generation.

From the study, Allianz uncovered four pillars of legacy: values and life lessons, instructions and wishes to be fulfilled, personal possessions of emotional value, and financial assets or real estate. Even though people thought it was important to discuss legacy issues, company executives found out that a lot of people still weren’t doing it.

The study found that 68 percent of Boomers and 71 percent of those in their parents’ generation say they have a high comfort level discussing legacy and inheritance, yet only 31 percent of elders and 29 percent of Boomers have had discussions that included all four pillars of legacy. In addition, the study found that non-financial leave-behinds—like ethics, morality, faith, and religion—are 10 times more important to both Boomers and elders with children than the financial aspects of a legacy transfer.

Results of the study have helped advisors gain awareness of what their clients find important to pass on to future generations. "Clearly the financial assets, [such as] the real estate, are important elements of this, but to the extent that the financial advisor can bring in some more of those intangible aspects, their ability to build a stronger relationship is significantly enhanced," Zesbaugh says.*

* Talking about Legacy and End-of-life Planning with Your Clients, Bank Insurance & Securities Marketing, Summer 2006