Thursday, November 10, 2022
Earlier this year, Bank of America conducted a Private Bank Study of Wealthy Americans and found significant differences amongst generations around investing, spending, philanthropy, and wealth planning. This is significant because it is expected that $73 trillion will be passed on to the next generation in the next decade-plus, with another $11 trillion given to charity.
The study surveyed over 1,000 high-net-worth individuals and found that three-quarters of younger people are not as confident in returns on traditional stocks and bonds as older generations, with younger generations more interested in sustainable investments that they hope can make a positive impact on the world. 73% of millennials have invested in sustainable investments compared to only 21% of older respondents.
When it comes to philanthropy, only half of all donors support the same causes as their parents, many seeking to find their own philanthropic identity. Another key finding was that only half of parents feel that their children are well prepared to inherit their wealth. Estate planning is a critical client need, with advisors central to addressing the needs of clients with well-executed plans that will address the communication and family dynamics that the older generations are concerned about.
For more information see Joe Dziemianowicz “Study of Wealth Americans Highlights Stark Contrasts Between Generations”, Barron’s PENTA, October 11, 2022.
Special thanks to Joel C. Dobris (Professor of Law, UC Davis School of Law) for bringing this article to my attention.