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The intergenerational wealth transfer: Are investment managers prepared?

By: Natalie Kenway


The transfer of wealth from baby boomers to millennials is coming and investment management firms need to make sure business models are ready.

Injections of investments into technology are certainly on the agenda, while groups are ramping up capabilities in responsible and ESG investing.

In our research with private investor for our bi-monthly Pulse study, which explores private investors behaviour and portfolio adjustments, RiF found that only 49% of private investors have had discussions with their children and/or grandchildren about arrangements for their estate.

Unsurprisingly, 94% plan to pass on an inheritance to their children and/or grandchildren with two thirds (67%) expecting to pass on most of their current estate, 9% expecting to pass on half and 14% said ‘some’ of their estate.

In our research for The Wealth Managers Review 2020, investment professionals – who have Extinction Rebellion and Greta Thunberg fresh in their minds – voiced there is an urgency for groups to start addressing this move, which will play a big part in shaping the operations and more popular product sets of the future.

“We know that younger investors, instead of thinking solely about returns, think about the impact their wealth can have” 

“Asset managers and DFMs need to engage in a way that embraces the needs of the next generation. We are at the start of that, it’s a long term trend. We need to think about the Greta effect.” – GLOBAL HEAD OF DISTRIBUTION, ASSET MANAGER

Although DFMs said the wealth transfer will take time, they recognise there is a need to be prepared for such significant change.

We explore this topic further in The Wealth Manager’s Review 2020 and our launch webinar on the 2nd April to register for the webinar please email [email protected].

Natalie Kenway

Natalie has joined Research in Finance to take on the newly created position of editor and head of content, working with our outstanding research team here she will be providing high quality insights to the financial services industry.