Generation X, people born between the mid 1960s and the early 1980s, and Millennials, those born between early 1980s and late 1990s, are set to inherit a substantial portion of the wealth, the New York-based consultancy said in a study released on Wednesday.
There are some 4.4 million individuals who belong to this group, each with a net worth of more than US$5 million, and together they hold assets of US$88 trillion, Altrata said.
“We expect that over a quarter of these individuals will seek to pass on their fortunes in the next decade to 2033, which will involve the transfer of a staggering level of wealth,” Altrata said, which used data compiled by its Wealth-X division.
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“This is a colossal sum, greater than the gross domestic product of the US, (US$24.7 trillion in 2023), the world’s largest economy, and more than 10 times the market capitalisation of US technology giant Microsoft, the world’s most valuable company.”
Of the 1.2 million wealthy individuals globally who will pass their fortunes over the next decade, about half will be from North America, collectively redistributing estates worth US$14.1 trillion, followed by Europe at US$7.4 trillion and Asia at US$6.1 trillion.
“Despite Asia being home to more wealthy individuals than Europe, just a fifth of wealth transfers will be in Asia due, in large part, to the donors’ younger average age (except in Japan),” the report said.
Unlike their parents, Generation X and Millennials are more aware and influenced by technological changes, the environment and social justice.
“The substantial transfer of family wealth over the next decade is set to occur in a period characterised by more frequent geopolitical conflict, rising political populism, heightened trade restrictions, widespread anti-elite and anti-immigrant sentiment, more extreme climate events and growing fiscal pressures from ageing populations,” the report said.
“Structural trends such as green-energy transition, expanded industrial incentives (primarily aimed at boosting domestic economies), increased regionalisation, greater defence spending, and broadening adoption of generative artificial intelligence will add to the complexity of succession planning for increasingly globalised wealthy families.”
Given the shift of wealth to the next generations, Altrata said healthcare and medical research and environment concerns are likely to get more attention from wealthy donors.
For the ultra-high-net-worth individuals passing on their assets, the top philanthropic causes are education, arts and culture, social services, and healthcare and medical research.
The priorities for the inheritors apart from causes that matter most to their parents include environment, conservation and animals.