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Inheritocracy summary

Name: Inheritocracy
Rating: 3.5 (20 reviews)
Author: Eliza Filby

Eliza Filby

It's Time to Talk About the Bank of Mum and Dad

3.5 (20 ratings)

17 mins

Brief summary

Inheritocracy examines the growing impact of wealth inheritance on social mobility and economic inequality. Eliza Filby delves into how family wealth shapes opportunities, creating a privileged class that influences modern society's structure and politics.

Topics

Economic Theory Wealth Personal Finances Social Philosophy Class Culture

Table of Contents

Inheritocracy
Summary of 5 key ideas

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Key idea 1 of 5

What’s in it for me? Learn why inheritance, not hard work, will shape life chances in tomorrow’s world.

Do you know someone like this? They’re in their mid- to late-20s. Their job is interesting and they’re good at it, but it doesn’t pay much. They rent, until suddenly, they don’t: they’re on the housing ladder. You wonder how they did it.

The answer: the Bank of Mom and Dad, the financial powerhouse remaking Western societies. Younger people increasingly rely on their parents to achieve the milestones long associated with adulthood. Putting down deposits on homes, helping with childcare, or topping up wages are just some of the vital financial services provided by the Bank of Mom and Dad.

Over the coming decades, millennials will inherit trillions of dollars of baby boomer wealth. This intergenerational wealth transfer – one of the largest in British history – won’t be equal. Those born into wealth will build on it; those who aren’t will struggle. Grit and talent matter, but not as much as inheritance. This, then, is the age of inheritocracy. The story we’ll be telling isn’t just about money, though: it’s about the kind of society we’re building and the one we really want to live in. As we’ll see, the gap between the two is widening.

Inequalities within generations trump those between them

Generational conflict is the perfect hot-button topic. It’s emotive. It taps into age-old antagonisms. And it sells. The more toxic the debate, the more we click and subscribe.

You know the clichés. Selfish boomers had it all: unprecedented growth, cheap homes, and a free education. Once they got theirs, they pulled up the ladder. Entitled millennials expect it all – the six-figure salary, the work-life balance, the sense of purpose. When it isn’t handed to them on a silver platter, they do what they do best: whine.

From “Ok boomer” TikTok reels to tabloid articles about avocado toast, these caricatures sustain the endless churn of content. Stale stereotypes aside, the problem with all this discursive rumbling is how it places generations in the role of contending classes. But boomers and millennials aren’t like bosses and workers in a zero-sum Marxist class war. Their interests aren’t entirely distinct or opposed; they intertwine and overlap. They are, after all, family.

Which brings us to inheritance.

As baby boomers – the generation born between 1946 and 1964 – reach the end of their lives, we’ll witness one of the largest wealth transfers in history. In Britain, which is our focus here, it’s estimated that $7.4 trillion will change hands over the next 20 years. In the United States, this figure is somewhere between $15 and $84 trillion. Boomers will pass this wealth on in two waves. First, during their lives as lump sums gifted or loaned to children to help them achieve important milestones. The “Bank of Mom and Dad” – the name given to parents who can offer this kind of financial support – is already a top ten mortgage provider in Britain. The second wave will come after their deaths. That’s how the bulk of British baby boomers’ wealth will make its way into the hands of millennials born between 1981 and 1996.

The scale of this wealth transfer makes inheritance one of the most important issues of our time. The economic divide opening up before us isn’t between the generations – it’s intragenerational. Age won’t separate the haves from the have-nots (or have-littles); unequal access to parental wealth will. What their parents own will do more to shape the life chances of under 45s than it has at any point since the Second World War.

That, in a nutshell, is the argument we’ll be exploring in this Blink. As we’ll see, this unevenly distributed windfall is set to turn British society on its head.

Britain is now an inheritocracy

In a famous thought experiment, political philosopher John Rawls asks us to imagine designing a just society from scratch. He helps us resist the urge to add unfair advantages by placing us behind a “veil of ignorance.” What that means is that we don’t know where we’ll end up: we could as easily be in the bottom 1 percent as the top five – or anywhere in between. Now, we want features that give everyone a fair chance. Suddenly, merit is at the center of our designs. Inherited privileges, meanwhile, are made to matter as little as possible.

Rawls wasn’t making an abstract point. Writing in the 1960s, he was defending the kind of society he believed best matched up to his philosophical description of justice: Western welfare states. These societies, he thought, had redistributed resources as equitably as possible in the real world. As a result, most people had a fair chance, and opportunity reliably flowed to those who merited it through talent and effort.

Parents are becoming gatekeepers to their children’s adulthood

There are several ways to describe an inheritocracy. The numbers tell part of the story. Take this one, for example: British parents handed over $11 billion to their children during the pandemic. That’s around 10 percent of the government’s COVID-19 job retention scheme – one of the most expensive peacetime economic interventions in British history. That wasn’t a one-off, though. As already mentioned, the Bank of Mom and Dad is a top-ten mortgage lender in Britain. In 2023, that amounted to $13 billion in gifts and loans.

Numbers only get us so far. But here’s an interesting statistic: 51 percent of baby boomers own a house with two spare bedrooms. That their children feel forced to stay in those rooms well into their 30s paints a picture of a society in which novel economic forces are overturning conventional ideas about growing up. The meaning of adulthood changes when your parents’ wealth determines your ability to achieve the milestones associated with it. In the words of one economist, parents are becoming “the gatekeepers to their children’s adulthood.”

Inequality compounds over time

The UK isn’t alone: the Bank of Mom and Dad operates internationally. Survey data from the Royal Bank of Canada, for example, suggests that 50 percent of Canadian parents subsidise “children” aged between 25 and 35. A 2019 study by Merrill Lynch found that 70 percent of millennials in the United States had received financial support from their parents that year.

Making your way independently through life is a lot harder than it used to be across the West. Wages have stagnated: in real terms, workers are earning less than they did in 2008 even as productivity continues to rise. Housing takes ever larger bites out of pay-checks. As the welfare state retreated, families stepped up to cushion kids from these economic blows. As one commentator noted, ours is an age of “good parents and poor citizens.”

Rising care bills might force us to address questions of generational fairness

There’s an elephant in the room: people lead longer lives and require increasingly complex medical care as they age. That care is expensive – and politically explosive.

How expensive? The average cost of a residential care home is around $1,000 a week; a week in a nursing home is closer to $1,500. Let’s take the latter figure. That makes around $78,000 a year – more than Eton, Britain’s most exclusive private school. The average stay in a nursing home is 2.2 years, but financial advisors urge families to plan for five. All in all, you’re looking at close to $800,000 for a couple. If you want a buffer – and advisers will tell you that you do want a buffer – you should be putting aside a sum closer to $1 million. In short: care is very expensive.

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What is Inheritocracy about?

Inheritocracy (2025) argues that meritocracy is a myth in today’s Britain. Inherited wealth, it suggests, trumps individual talent and effort in shaping the life chances of younger generations – above all, millennials. This isn’t a purely economic story, though: the increasing prominence of parents in adult children’s lives is redefining ideas about everything from growing up to love.

Who should read Inheritocracy?

Millennials wondering why adulthood feels financially out of reach
Parents thinking about wealth, legacy, and fairness
Anyone interested in inequality, housing, and generational shifts

About the Author

Eliza Filby is a British historian and author who explores generational changes in her work. Her writing has appeared in The Times, The Guardian, the Financial Times and the New Statesman. She received the Europa Forum’s Millennial Leaders Award for her research on generations in 2022. Filby hosts the It’s All Relative podcast and is the author of the #MajorRelate newsletter.

Categories with Inheritocracy

Economics Society & Culture Money & Investments

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