Among ultra-high-net-worth investors, it’s estimated that $27 trillion will pass from one generation to the next by 2050, a study released May 7 by Morgan Stanley Private Wealth Management and Campden Wealth found.
The report, “Next-Generation Wealth: The New Face of Affluence,” surveyed 53 families, 73% of which had a net worth of more than $100 million. The “next generation,” those between ages 20 and 49, represented 45% of respondents.
Most next-generation respondents (79%) consider “being a good steward” of their families’ wealth very important, and the survey found many wished for more involvement. Unsurprisingly, older members of the next generation were more involved with their families’ investment decisions than younger members of the same group and were more satisfied with the outcomes. Eighty-four percent said they were happy with their families’ plans for wealth transfer. One-quarter of those between 30 and 39 said they were unhappy with their families’ investment decisions and 43% said they did not agree at all with their families’ plans for wealth transfer.
The report found next generation respondents are already working to build their own wealth. Thirty percent have “significant wealth of their own” and 17% are involved in entrepreneurial ventures.
Twenty-nine percent of older respondents said they built their wealth on family wealth. In fact, 60% said they planned to leave “substantially all of their wealth” to their children. By comparison, just 44% of the next generation said they planned to do the same. Less than half of the next generation said wealth re-creation was very important to them and 28% said it was of little importance.