Heirs to Trillions Set to Inherit Wealth Differently Than Previous Generations

The largest transfer of wealth in modern history is underway, and the heirs set to inherit trillions of dollars in family fortunes are preparing to use the money very differently from the generations that built it.

Over the next two decades, an estimated $83.5 trillion is expected to pass from baby boomers and older entrepreneurs to their children and grandchildren, according to UBS.

"The world is entering a historic intergenerational wealth transfer," UBS told CNBC. Billionaire families alone are expected to transfer about $6.9 trillion by 2040.

For many wealthy families, the first generation built fortunes in concentrated areas they knew well: family businesses, property, or local blue-chip shares, wealth experts told CNBC. Their children are more likely to be internationally educated, more mobile and open to a wider range of investments.

"The first generation were 'builders,'" said Elizabeth Hart, CEO and founder of Legacy Wealth Advisors. "Their wealth is usually tied to a single asset class they understand deeply, often a family operating business or local blue-chip shares."

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

That shift could redirect some of the inherited wealth away from traditional stores of family capital, particularly real estate. Hart said that Asian families, in particular, have historically invested "almost exclusively in property for generations," but second- and third-generation heirs are increasingly looking to diversify into other assets and geographies.

A Natixis Investment Managers survey found that millennials are far more likely than older investors to seek exposure to private assets, with 53% expressing interest. They are also more likely to discuss cryptocurrencies with advisers, with 62% doing so, while 44% plan to increase or begin crypto investments within the next year.

The younger generation also appears more comfortable with risk. Natixis found that 78% of millennials in the Asia-Pacific region want opportunities to beat the market, compared with 38% of baby boomers willing to take risks to get ahead.

Tobias Prestel, founder of Prestel & Partner, said younger wealth holders increasingly see money less as an end in itself and more as a means to achieve goals.

"For most elder people, money is a thing, and money is good for more, for most younger ones, money is just a tool," Prestel said. "They are more looking into how the tool is used than enjoying the treasure chest."

The changing mindset is also influencing spending habits. Instead of building collections of traditional status symbols, some younger heirs are prioritizing experiences, mobility and international lifestyles. Prestel said younger wealthy individuals are less likely to collect cars and more likely to own residences around the world, combining travel with global property exposure.

Interest in sustainability and impact investing is also gaining traction. UBS found that nearly half of next-generation investors are already invested in or keen to learn more about impact and sustainable investing.

The transfer is also reshaping how families manage wealth. The bank found that next-generation family members increasingly see inheritance as a transfer of responsibility rather than an eventual financial windfall.

"My brother and I don't think of inheritance as something we're going to get, but rather as our responsibility to do as good a job as our father did," one respondent told UBS.

Yet the transition is not without risks.

While the sheer volume of wealth changing hands is unlikely to derail the broader transfer, advisers say the biggest risks to preserving wealth often come from within families themselves.

"The crack is not a lack of money; it's a lack of communication," Legacy Wealth Advisors' Hart said.

Many first-generation wealth creators remain reluctant to relinquish control, particularly in Asia, where fortunes are often closely associated with a family patriarch or matriarch. Meanwhile, heirs are pushing for greater transparency, succession planning and formal governance structures around family assets.

"Even with a succession plan, the biggest destroyer of wealth is family dispute," Hart added.

As fortunes move beyond their founding generation, advisers say successful transfers increasingly depend on preparing heirs for stewardship, not just structuring the assets themselves.