Canada is in the middle of the largest intergenerational wealth transfer in history. Over the next decade, an estimated $1 trillion will move from baby boomers to their children and grandchildren. But here’s the challenge: most families aren’t prepared, and the odds aren’t in their favour.

Studies show that about 70% of family wealth is lost by the second generation, and 90% is gone by the third. That’s not due to bad investments or high taxes. The main reason? A lack of communication, planning, and education.

What Does It Mean for Wealth to “Disappear”?

We’re not just talking about money getting spent. Wealth “disappears” when it’s poorly managed, tied up in estate disputes, or lost to inefficient tax handling. It happens when the next generation isn’t equipped to handle the responsibility that comes with inheriting assets.

Why It Happens So Often

1. Silence around money:
Many parents avoid talking about wealth because they think their children aren’t ready, or they worry it will create entitlement. But this silence often leads to confusion, resentment, or poor decision-making when the time comes.

2. Lack of planning:
An outdated or missing will, no power of attorney, no clear plan, these are mistakes that create headaches, delays, and legal issues. Without direction, families are left guessing.

3. Financial inexperience:
Managing wealth requires a different skill set than earning it. When heirs haven’t been exposed to financial concepts or advisors, they’re more likely to make costly mistakes.

How to Break the Cycle

Here’s how families can take control and help ensure their wealth lasts more than one generation.

Start with your values

Wealth isn’t just about numbers. Talk to your children or heirs about the purpose behind the money—whether that’s financial independence, helping others, or supporting a family business. When values are clear, decisions become easier.

Create and update your estate plan

An estate plan isn’t a “set it and forget it” document. Review it regularly to reflect new assets, family changes, or evolving goals. You might also consider more advanced planning tools like trusts or estate freezes to protect your assets and minimize tax.

Talk early, talk often

Start age-appropriate conversations about money while your kids are young. As they grow, involve them in family budgeting, charitable giving, or investing decisions. This builds confidence and experience over time.

Educate the next generation

Financial literacy is key. Encourage your heirs to work with financial advisors, attend workshops, or take part in wealth planning meetings. Understanding how to read a balance sheet or navigate tax decisions can be just as important as receiving the wealth itself.

Introduce your advisory team

Many families benefit from bringing children into meetings with their financial planner, accountant, or lawyer. This helps build trust and ensures continuity when the wealth eventually transitions.

A Simple Example

Let’s say you’re a 65-year-old business owner with a $3 million estate. You want your two children to inherit the assets equally, but they have different financial habits.

Without a plan, the estate could get tied up in probate, trigger high taxes, or even create tension between siblings.

But with proper planning—say, creating a will, using an estate freeze to transfer future growth, and setting up a trust for one child while leaving an outright gift to the other, you can ensure the transition is smooth, tax-efficient, and aligned with your goals.

Final Thoughts

The great wealth transfer is already happening. If your goal is to pass down more than money—if you want to leave a legacy, then communication, education, and planning are essential.

You don’t need to be ultra-wealthy to start. You just need a willingness to think long-term and involve the people who will one day carry your values forward.