The ever-widening wealth divide

In 2004 median inheritances — half were bigger and half were smaller — amounted to about $29,000 in today's money, according to a Federal Reserve analysis of the Survey of Consumer Finances. That is enough for the heirs to buy a new Pontiac Coupe. But for almost all, it is hardly life-changing money.

Nor are inheritances likely to increase. According to the analysis of the Fed data by Mark Zandi of Moody's Economy.com, 30 years ago the median inheritance was about $10,000 more, adjusted for inflation.

These meager bequests would seem to fly in the face of the huge transfer of wealth making its way down the generations.

Yes, big money is being passed down. According to the Fed data, the overall pie of inheritances has grown to nearly $200 billion annually — more than three times the amount that was passed down in the mid-1970's, after accounting for inflation. Paul Schervish and John Havens of Boston College's Center for Wealth and Philanthropy predict that by midcentury, $25 trillion will be passed from the old to their offspring.

But the typical American is seeing little of this wealth. Mr. Schervish and Mr. Havens found that most money would go to a few lucky heirs: 7 percent of the estates would account for half the aggregate bequests.

Those heirs are fueling brisk growth in the wealth-management industry, a niche enterprise catering mostly to the rich.

"We are seeing bigger-sized estates," said Myra Salzer, president of the Wealth Conservancy in Boulder, Colo., which helps heirs manage their inherited wealth.

"Wealth is just exploding," said Daniel FitzPatrick, chief executive of Citigroup Trust, whose clients typically have hundreds of millions of dollars.

Another study, based on the University of Michigan's Health and Retirement Study, also shows the disparities. Michael D. Hurd and James P. Smith of the RAND Corporation estimated that half of the children of parents born from 1931 to 1947 — that is, parents who are about 60 to 75 years old — would inherit less than $19,000, while the top 5 percent would receive at least $237,000.