The largest wealth transfer in modern history is underway. Over the next two decades, about $83.5 trillion is expected to move from baby boomers and older entrepreneurs to their children and grandchildren, according to UBS.
UBS told CNBC: “The world is entering a historic intergenerational wealth transfer.” Billionaire families alone are also expected to transfer about $6.9 trillion by 2040.
In many wealthy families, first-generation wealth is often concentrated in areas they know well: family businesses, real estate or local blue-chip stocks. By contrast, the next generation is more likely to have an international education, greater mobility and an openness to a wider set of investment choices.
Elizabeth Hart, CEO and founder of Legacy Wealth Advisors, said: “The first generation are the builders, and their wealth is usually tied to one asset class, which they often understand deeply, such as a family business or local blue-chip stocks.”
Hart added that younger heirs tend to view wealth from a global perspective and are more willing to diversify across asset classes and markets.
That shift could move some inherited capital away from traditional family stores of wealth, especially real estate. Hart noted that Asian families have long been “almost exclusively invested in real estate for generations,” but second- and third-generation heirs increasingly want more diversification by asset and geography.
A Natixis Investment Managers survey found that, compared with older investors, millennials are more likely to seek exposure to private assets, with 53% expressing interest. They are also more likely to discuss crypto with advisers: 62% say they do, and 44% plan to increase or start crypto investing in the next year.
On risk appetite, younger generations are also more comfortable. Natixis found that 78% of millennials in Asia-Pacific want the chance to outperform the market, while 38% of baby boomers are willing to take risk to get ahead.
Using money as a tool: goal-driven wealth
Tobias Prestel, founder of Prestel & Partner, said younger wealth holders increasingly see money as a tool to achieve goals, rather than an end in itself.
Prestel said: “For most older people, money is a thing, and money is a good thing; for most younger people, money is just a tool. They care more about how the tool is used than about enjoying the treasure chest itself.”
That mindset shift is also changing spending habits. Rather than building traditional status-symbol collections, some younger heirs value experiences, liquidity and an international lifestyle. Prestel said younger wealthy people are less likely to collect cars, and more likely to own homes in different parts of the world: they combine travel with a global property allocation.
Interest in sustainable and impact investing is also rising. UBS says nearly half of next-generation investors already hold, or strongly want to learn about, impact and sustainable investments.
At the same time, wealth management itself is being reshaped. UBS found that next-generation family members increasingly see inheritance as a transfer of responsibility, not simply a future windfall.
One respondent told UBS: “My brother and I don’t think of inheritance as something we will get; it is our responsibility: to do things well, the way our father did.”
Still, the transition is not without risk.
Advisers say the sheer scale of the wealth change itself is unlikely to derail the overall transfer, but the biggest risk to keeping wealth often comes from within the family.
Legacy Wealth Advisors’ Hart said: “The cracks are not because of a lack of money, but because of a lack of communication.”
Many first-generation wealth creators are reluctant to give up control, especially in Asia, where family wealth is often closely tied to the patriarch or matriarch; meanwhile, heirs are pushing for greater transparency, succession plans and formal governance structures around family assets.
Hart added: “Even when a succession plan is in place, family disputes remain the biggest destroyer of wealth.”
As wealth moves out of the founders’ hands, advisers say successful succession increasingly depends on preparing heirs early for stewardship, rather than simply designing the asset structure.
