Understanding Wealth Transfer Strategies and Their Impact

$124 trillion. That’s the amount of wealth Cerulli Associates anticipates will transfer through 2048. Not just a change in ownership, but a fundamental shift in how capital is controlled, invested, and distributed. Here’s where it’s going: • $46 trillion to Millennials (ages 27-42), who are already reshaping investment strategies with a stronger focus on private markets, direct deals, and businesses that align with their long-term vision. • $39 trillion to Gen X (ages 43-58), putting them in a key position to manage this transition while setting the stage for the next era of wealth management. • $15 trillion to Gen Z and younger (under 27), a group that will push investments further into technology, emerging industries, and non-traditional asset classes. • $18 trillion into philanthropy, reinforcing the shift toward capital being used not just for returns, but for long-term influence. • $6 trillion transitioning away from Baby Boomers, signaling the final handoff of financial leadership. For Family Offices, this isn’t just a shift in who holds the wealth—it’s a shift in how that wealth is put to work. The next generation thinks differently. They prioritize flexibility, private investments, and using capital as a tool for impact. That will influence everything from how businesses raise money to how global markets function. And it doesn’t stop there. This transfer will shape industries, drive new innovations, and redefine what financial success looks like. It’s not just about Family Offices or high-net-worth individuals—it will have ripple effects that influence the economy, philanthropy, and the world our children grow up in. Where all this wealth ultimately lands—and how it’s used—will be one of the most important financial stories of our time.

According to a new Redfin study, over 20% of Gen Z and millennials who recently bought a home got financial help from family for their down payment, and 18.2% of young renters aren’t buying because they can’t afford a down payment. These stats immediately resonated with me. Back in 2004, I bought my first home thanks to my grandfather. He took a cash-out refi on an investment property to help me with my down payment. I was incredibly fortunate, not just that he wanted to help, but that he could afford the increased payment that came with higher loan balance. Fast forward to 2025, and things look very different. Interest rates are high. Inflation is stretching household budgets. The option my grandfather used isn't feasible for many families today. But that doesn’t mean the opportunity to help the next generation is gone, it just might look different. Are we overlooking a better option? With over $10.6 trillion in untapped home equity held by older Americans, there’s a powerful and underutilized tool available: reverse mortgages and reverse mortgage (no payment) home equity loans. These allow people 55+ to access home equity without taking on new monthly payments, while potentially gifting part of that equity forward, as an early inheritance, to help children or grandchildren buy their first home. What impact could this have? >Helping younger generations avoid dipping into retirement accounts too early. >Getting them into a home early - the asset most likely to build long-term wealth. >No impact to the cash flow of the person offering help. >Aligning generational wealth transfer with the timing that matters most. The older generation maintains ownership, preserves their retirement lifestyle, and gives financial help when it’s needed most, not decades later. Could this be part of the solution to unlock a path to homeownership for the next generation? With prices at record highs and down payments averaging $63k, the barriers are steeper than ever for younger Americans. But what if the solution to this affordability crisis is already sitting in the homes of older generations, who hold on average over $200k in tappable equity? Why does timing matter in wealth transfer? With people living longer than ever, traditional inheritances may not arrive until heirs are already nearing retirement themselves. By contrast, helping younger family members buy a home now aligns wealth transfer with life’s inflection points - marriage, children, relocation - and could help close the intergenerational wealth gap exacerbated by today’s housing costs. Imagine the ripple effect if even a fraction of the eligible homeowners who haven’t tapped their home equity considered this option. How many more of the 18% of Gen Z and millennial renters currently sidelined by affordability could become owners? Is it time to rethink what financial support looks like across generations?

The Great Wealth Transfer: $124 trillion is changing hands, but how many families are prepared for the cliff ahead? Recent studies suggest alarming trends in wealth preservation: → Nearly two-thirds of wealth transfers fail to maintain assets across generations → The majority of inheritances significantly diminish by the third generation → Most families focus on financial mechanics while neglecting family dynamics 𝗧𝗵𝗲 𝗴𝗿𝗲𝗮𝘁𝗲𝘀𝘁 𝗿𝗶𝘀𝗸 𝘁𝗼 𝗳𝗮𝗺𝗶𝗹𝘆 𝘄𝗲𝗮𝗹𝘁𝗵 𝗶𝘀𝗻'𝘁 𝘁𝗵𝗲 𝗺𝗮𝗿𝗸𝗲𝘁 – 𝗶𝘁'𝘀 𝘁𝗵𝗲 𝗼𝗺𝗶𝘀𝘀𝗶𝗼𝗻 𝗼𝗳 𝗩𝗔𝗟𝗨𝗘𝗦 𝗶𝗻 𝘁𝗵𝗲 𝘄𝗲𝗮𝗹𝘁𝗵 𝘁𝗿𝗮𝗻𝘀𝗳𝗲𝗿 𝗰𝗼𝗻𝘃𝗲𝗿𝘀𝗮𝘁𝗶𝗼𝗻. Its in the inability (or lack of EQ expertise) to effectively address tricky, tense family dynamics.  (And no one seems to know how to relate to Gen Z) 🔖 5 Warning Signs Your Family Wealth Is Headed for a Cliff: ➥You've mastered tax strategies but never articulated 𝘸𝘩𝘢𝘵 𝘵𝘩𝘦 𝘮𝘰𝘯𝘦𝘺 𝘪𝘴 𝘍𝘖𝘙 ➥Your succession plan exists on paper but NOT in practice or effective preparation (& you've got family members who are off piste or just not speaking to each other🙃) ➥Family meetings focus on investment returns but avoid addressing interpersonal conflicts or family dynamics (Lift rug. Sweep). You keep trying to throw money on problems money cannot solve. ➥Next-gen members receive financial literacy but no purpose literacy ➥Your children can recite your net worth but can't explain your family's core values (read that last one again) Let's be honest, it is EASIER to talk about numbers and money than matters of the heart, complexities around VERY different psychologies, work ethics, grit, values, miscommunication, misalignment. 📢𝟱 𝗦𝗼𝗹𝘂𝘁𝗶𝗼𝗻𝘀 𝘁𝗼 𝗦𝗲𝗰𝘂𝗿𝗲 𝗬𝗼𝘂𝗿 𝗙𝗮𝗺𝗶𝗹𝘆 𝗟𝗲𝗴𝗮𝗰𝘆: (𝘀𝘁𝗮𝗿𝘁 𝗽𝗹𝗮𝗻𝗻𝗶𝗻𝗴 𝘁𝗵𝗲 𝗿𝗶𝗴𝗵𝘁 𝘄𝗮𝘆) ➥Create a Family Mission Statement that articulates shared values, not just financial goals ➥Implement regular "values councils" where multiple generations discuss purpose, not just portfolios (this requires understanding, appreciating and leveraging the different psychologies and values of each generation FIRST, versus resenting them - and that takes some work!) ➥Develop experiential learning environments for next-gen members to practice stewardship before inheritance ➥Establish mentorship pairs between generations focused on wisdom transfer, not just wealth transfer ➥Design a "purpose portfolio" where family members collaborate (without killing each other!) on impact initiatives aligned with shared values The hardest family conversations aren't about money – They're about meaning. Yet most wealth creators avoid them until it's too late. Want to know more on how I'm uniquely placed to help with that dynamics piece?  send a DM. ********** VC📹:  sickos instagram & youtube ➕follow Dawn Mari La Monica, JD for more on legacy & next gen prep ♻️reshare if this video resonated (I mean it's fun, no?)

For years, the big transfer of wealth—Baby Boomers passing down trillions to the next generation—has dominated fundraising discussions. But recent findings from Charles Schwab reveal a more complex and generationally nuanced story about how high-net-worth individuals are thinking about wealth transfer and philanthropy. ⭐ Baby Boomers (Ages 60 to 78) ⭐ Millionaire Boomers are less likely to share their wealth during their lifetime compared to younger generations. Their focus remains on preserving financial security and independence, often prioritizing their own enjoyment of wealth over immediate transfers to heirs or philanthropic giving. ⭐ Gen X (Ages 44 to 59) ⭐ As the “sandwich generation,” Gen Xers face unique pressures, balancing support for aging parents and their own children. Interestingly, Gen X millionaires are twice as likely as Boomers to prefer passing wealth to the next generation during their lifetime. This generation tends to be practical and outcome-driven, taking a measured approach to giving while ensuring their financial planning supports multiple priorities. ⭐ Millennials (Ages 28 to 43) ⭐ Millennials are leading the charge in reshaping wealth transfer. They are significantly more likely to want their wealth to make an impact now, whether through philanthropy or sharing it with heirs during their lifetime. Transparency and sustainability are key values for this generation. The study also highlights broader trends: ➡️ Three in five wealthy Americans who intend to pass on wealth say they started planning before the age of 45. ➡️ Over half began their wealth transfer planning once they reached a net worth of $1 million. These findings challenge assumptions about when—and how much—wealth will flow into philanthropy. Read the full Schwab study here: https://lnkd.in/gnwyPytC