The biggest generational wealth handoff: how the next generation will spend trillions

The largest wealth transfer in modern history is underway, and the next generation set to inherit trillions of dollars from family fortunes plans to use that money differently from the “wealth creators” before them.

According to UBS, over the next two decades an estimated $83.5 trillion will move from baby boomers and older business owners to their children and grandchildren.

UBS told CNBC: “The world is entering a wealth transfer across generations of historic scale.” Billionaire families alone are also expected to transfer about $6.9 trillion by 2040.

For many wealthy families, the first generation often concentrated their wealth in familiar areas: the family business, real estate, or local blue-chip stocks. Wealth experts told CNBC that their children are more likely to have international educations, be more mobile, and be open to a wider range of investment choices.

Elizabeth Hart, founder and CEO of Legacy Wealth Advisors, said: “The first generation are the builders. Their wealth is usually tied to one asset class, often something they understand deeply, such as an operating family business or local blue-chip stocks.”

By contrast, younger heirs tend to view wealth through a global lens. Hart added that they are more open to diversified investing across asset classes and markets.

That shift could move part of inherited wealth away from the traditional home for family capital, especially real estate. Hart said Asian families have historically been almost entirely focused on property, but second- and third-generation heirs are increasingly diversifying into other assets and regions.

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 cryptocurrency with advisors: 62% said they would, and 44% plan to start or increase crypto investing in the next year.

Young investors are also more comfortable with risk. Natixis found that 78% of millennials in Asia-Pacific want opportunities to outperform the market, compared with 38% of baby boomers willing to take risks to get ahead.

Money as a tool, not just wealth itself

Tobias Prestel, founder of Prestel & Partner, said younger wealth holders increasingly see money as a means to achieve goals rather than the goal itself.

He said: “For most older people, money is a thing, and money is good; for most younger people, money is just a tool. They care more about how the tool is used than about sitting on a treasure chest.”

That mindset shift is also changing spending habits. Instead of building traditional status-symbol collections, some younger heirs place more value on experiences, mobility, and international lifestyles. Prestel said younger wealthy people are less likely to collect cars and more likely to own homes around the world, combining travel with global real-estate exposure.

Interest in sustainable and impact investing is also rising. UBS found that nearly half of next-generation investors are already investing in, or strongly interested in learning more about, impact and sustainable investing.

The transfer is also reshaping how families manage wealth. UBS research shows that younger family members increasingly see inheritance as a transfer of responsibility, not a windfall they will one day simply receive.

One respondent told UBS: “My brother and I don't see inheritance as something we will get, but as a responsibility to do things well and reach the standard our father achieved.”

Still, the transition is not without risk.

Advisors say that while the sheer size of the wealth handoff is unlikely to derail the broader transfer, the biggest risks to preserving and growing capital often come from within the family.

Hart of Legacy Wealth Advisors said: “The fracture is not lack of money, it is lack of communication.”

Many first-generation wealth creators are reluctant to let go of control, especially in Asia, where family wealth is often closely tied to a senior family figure. At the same time, heirs are pushing for more transparency, succession planning, and formal governance structures around family assets.

Hart added: “Even with succession plans, the biggest factor that destroys wealth is still family conflict.”

As family assets move from the founding generation to the next, advisors say successful transfers increasingly depend on preparing heirs for stewardship, not just on the asset structure itself.