Suzanne*, a middle-aged Melbourne mother, remembers her happy childhood with her wealthy parents. Her father passed away when she was young, and her mother remarried. Suzanne’s stepfather was unkind, often belittling and bullying the family.
Very good analysis. Focus on housing supply as a solution to increasing wealth inequality is indeed a promising way forward when inheritance taxes are unpopular.https://t.co/ts4KqJfofi
— Gabriel Felbermayr (@GFelbermayr) February 27, 2025
More than a decade ago, when her mother grew sick, their family assets were still worth millions. Her mother’s will seemed clear: the majority would go to the children, and her stepfather would be provided for. However, after Suzanne’s mother’s death, her stepfather contested the will, initiating a bitter legal battle.
Fiksua politiikkaa on vapauttaa rakentamista.
"Building enough houses in the right place is the single biggest action governments can take to restore the link between work and wealth."
Inheriting is becoming nearly as important as workinghttps://t.co/XdACHKqAvz
The Economist— Aarne Leinonen LIB kuntavaaliehdokas HKI (@AarneLeinonen) February 28, 2025
@TheEconomist features data from some of my research with P. Acciari, Giacomo Gabbuti @GGabbuti & Demetro Guzzardi @DemetrioGuzz on the growing role of inheritance in wealth accumulation.
Proud to see our work shaping the debate!https://t.co/dG1scBILkM
— Salvatore Morelli (@MorelliSal) February 27, 2025
Suzanne, who was in debt over $250,000 from the legal battle, felt her world collapse as the court case drained her financially and emotionally. She recalls disappointing court encounters, where judges focused on her privileged upbringing instead of her stepfather’s unkindness. Suzanne’s predicament is not unique.
Many predict a decade or more of vicious family battles over inheritances.
»In 2023, 53 people became billionaires thanks to inheritance, not far short of the 84 who made their own fortunes« (https://t.co/XrlDc5J8HL) pic.twitter.com/heGpFVm1EV
— Oliver Weber (@OliverBWeber) February 28, 2025
The first of the Baby Boomers are expected to pass down about $3.5 trillion in the next decade, marking the largest intergenerational wealth transfer in history.
Family inheritances ignite prolonged disputes
A report by Australian Seniors found that a third of people over 50 don’t have a will, and of those who do, half haven’t updated it in more than five years. Such omissions can lead to confusion and disputes, especially within blended families, which now make up more than 12 per cent of Australian families with children. The complexity increases with rising lifespans and increasing cases of dementia.
Often, older adults’ decisions about estate planning may be influenced by diminished mental capacities. Simultaneously, their heirs, often dealing with significant financial burdens, might press their parents into divesting assets prematurely. More than 90 per cent of such disputes are resolved through mediation rather than court battles, but the few that do go to court are highly charged and sometimes make the news.
Queensland barrister Caite Brewer recalls a harrowing case involving a young father killed in active service overseas, whose outdated will left nothing to his newborn son, a situation his siblings fiercely contested. Solicitor Anna Hacker of Pitcher Partners in Melbourne emphasizes the importance of resolution in such cases due to the immense familial trauma caused by long litigations. She recalls a client who opted not to challenge a will to maintain family relationships, an act she described as incredibly impressive but exceedingly rare.
In reality, most cases see families willingly destroying past connections and shared histories in pursuit of financial gain. This phenomenon underlines the significant emotional and societal implications of estate planning battles—a legal area ripe for dramatic representation and an increasingly common challenge for many families across Australia. *name changed for privacy reasons
Image Credits: Kaboompics.com on Pexels
