As the baby boomer generation closes in on retirement, many are preparing to drop a substantial portion of their wealth on charitable causes, perhaps to their children's chagrin.

Only about half, or 55%, of baby boomers between the ages of 47 and 66 felt it was important to leave a financial inheritance to their children or heirs, according to the 2012 U.S. Trust Insights on Wealth and Worth Survey. Compare that to approximately three-fourths of high-net-worth individuals (with over $3 million in investable assets) in the surrounding generations who felt strongly about bequeathing an inheritance.

"It's the baby boom generation sandwiched in the middle that tends to be more philanthropically inclined and also places less importance and less emphasis on passing wealth inter-generationally," says Chris Heilmann, chief fiduciary executive at U.S. Trust Bank of America Private Wealth Management.

The boomer generation reported being twice as likely to siphon their money off to other charitable causes rather than let it fall straight to their children, and some early indications of that have already shown up. There was a 21% increase to $75,867 in 2009 from $62,680 in 2007 in the amount of philanthropic dollars that went to a giving vehicle such as a donor advised fund or a split interest trust, according to a 2010 biennial study on high-net-worth philanthropy conducted by The Center on Philanthropy at Indiana University and sponsored by Bank of America.

"There was a huge uptick in the amount of money that went to them, so we know folks are getting more organized, more structured, and therefore by extension more committed to philanthropy," Clair Costello, national philanthropic practice executive at Bank of America, says.

Several factors are at play as baby boomers begin to plan out how they're going to pass on their bucks. For one, the boomer generation has more of an entrepreneurial spirit, Heilmann says. As the ones who have founded or substantially grown a business, they see themselves as the primary wealth creators and have high expectations for their children to follow suit.

"Typically what we have found in digging a little deeper with some baby boomers is this whole issue of the baby boom generation viewing themselves as being wealth creators and that they earned it and therefore are expecting the next generation to need to earn it as opposed to simply passing it on," Heilmann says.

Similarly, many wealthy boomer parents worry that passing too much money along may spoil their children and discourage them from seeking their own fulfillment. There are cautionary tales in a few high-profile cases of misspent inheritances, according to Chip Roame, managing principal at Tiburon Strategic Advisors. "There has been some backlash from trust fund babies in the news," he notes in an email.

With that in mind, Costello says, it is the Warren Buffet model that resonates among baby boomers: that an individual should give "enough money so that they would feel they could do anything, but not so much that they could do nothing." (True to his word, Buffet capped his son Peter Buffet's trust at $90,000 in stock.)

Costello often asks wealthy clients what they would pass along if they had only one option: wealth or values? And they always say values. They view how they use their money as one way of demonstrating what's important to their kids. Many have the mindset that: "It also serves my children because they're watching me do this, and they'll be better citizens of the world because of it," she says.

Three-quarters of boomers reported that they felt a responsibility to be philanthropic while only two-thirds of older respondents and approximately half (53%) of the younger generation felt that same charge, according to the survey. Costello believes that because of the Vietnam War, the march on Washington and the civil rights movement, many boomers have an outlook based around community organizing.

"There's a whole sense of context around acute need, the desire to use their assets; be it their expertise, their volunteer time, and yes, their dollars to address those concerns and this notion that their children will get something, or perhaps not," Costello says.

It's that "perhaps not" possibility that tends to foster animosity between baby boomer parents and their children when it comes time to have a discussion about inheritance. Boomers were twice as likely to say they would leave only a "small portion" of their estate to their children or family, according to the survey.

"There are always conflicts," Costello adds. "It's not often easy to come to understand that mom and dad would rather give this money to a perfect stranger three continents away than give it to me when I need it." To that end, she advises her wealthy clients to start orienting children toward a giving or charitable mindset as soon as age two; "whenever you hear the word 'mine.'"

"Particularly people of wealth," Costello says, "they go to the best summer camps, they go to the best private schools, and they don't sit in the ER and wait for healthcare. They seemingly could go through life without really understanding. So, it is very hard for the high-net-worth and ultra-high-net-worth to make sure their children are exposed to meaningful interactions [with the] issues of the day, be it environment or human or whatever, so they can understand that."

Costello promotes small steps that help instill a sense of charitable giving, including "kindness days" where every person in the family must perform one helpful act for someone-unsolicited. Generally, she says, this helps children become more in tune with the family's overarching philanthropic goals before their parents bring them to the table. Other solutions include a trust with strings attached. In some cases, she has had grandparents establish a trust that will pay for their grandchildren's education once they are able to show that they have completed significant public service work.

When clients are prepared to start giving, Costello asks them to envision a hypothetical headline 20 years in the future, whether it be "Literacy Levels in My County Reach 100%" or "Cancer Incidents Halved." Then, she starts them out with grants for a few organizations. Once the grants begin to take effect, she will check back in to compare which have been successful relative to clients' goals and headlines. Then, they can continue to build toward that future.

"When you see folks get on their own path, you see why that statistic is what it is," Costello says. "It's a deeply satisfying endeavor. That speaks to where we started, which is why folks are inclined to give it away to people or causes other than their children."