As baby boomers gradually enter old age, the wealth that will be bequeathed to the next generation will be unprecedented.

If every Canadian received the same inheritance, inequalities between each person’s net assets would be reduced by 40%, reveals a study, published in 2022 in the Journal of Economic Inequality. It sums up well, in the eyes of sociologist Maude Pugliese, how much the fact of having an inheritance or not colors the financial destiny of each person.

And widens inequalities, due to the snowball effect by which “the richest become richer largely because they have received more inheritance”, notes Ms. Pugliese.

Like Ms. Pugliese, Richard Guay, professor of finance at the School of Management Sciences at UQAM, insists on the fact that the transmission of wealth will be very unequal from one family to another.

According to an IPSOS survey of Canadians conducted in 2023 on behalf of Sun Life, baby boomers who plan to leave all their assets to their children hope to pass on $940,000 to them on average. A sum much higher than what their heirs expected, who believe they will only receive $309,000.

Julie, who is in her forties, explains that the inheritance recently received from her father allowed her to pay off all of her debts. “It took a lot of stress off my mind,” says the woman, who asked that her name be withheld given the private nature of these matters.

Those who will be deprived of an inheritance will never have this chance. But is the increase in inequalities inevitable?

Richard Guay notes that at the very least, both the federal and provincial governments have just increased the capital gains tax, which will result in a certain redistribution of wealth.

“It is clear that this measure targets inheritance taxes in particular,” he notes.

Antoine Genest-Grégoire, assistant professor of taxation at the University of Sherbrooke, points out that we could go further. To better redistribute wealth, we could consider “providing a capital endowment to all young adults.” “Essentially, we take from very unequal inheritances to give everyone a uniform capital at the start of life,” he explains. This capital can be used to pay for studies, start a business or serve as a down payment on housing. A boarding house for young adults? Mr. Genest-Grégoire responds that when this idea is discussed, we think “of a single amount offered to the majority”.