UBS Global Wealth Management has issued its first UBS Global Next Generation Report, surveying next generation wealth inheritors on their sentiment toward both wealth transfer and its inherent responsibility, ahead of the $83 trillion expected to change hands over the next two decades.

UBS Global Wealth Management's latest report highlights how an estimated $83 trillion in private wealth is expected to transfer globally over the next two to three decades, making this the largest wealth transfer in modern history.

As families evolve, wealth management is becoming more institutionalized, with nearly four in 10 operating through a single-family office, the report states. Traditional asset classes remain core and the appetite for newer assets is more measured, while the next generation has a keen interest in sustainability and impact investing, with nearly half building exposure to these investment themes.

The next generation individuals surveyed for the report represent the full age spectrum from below 21 to above 45, with the majority being between 26 and 40-years-old. Geographically, they reflect the international footprint of global families. With 49 per cent, Europe represents the largest share of respondents, followed by North America (19 per cent), Latin America (16 per cent), Asia-Pacific (11 per cent) and Middle East and Africa (5 per cent).

Impact investing outpaces crypto
The report shows that 79 per cent of respondents invest primarily in traditional assets (stocks and bonds), while around half hold real estate or passive investment funds.

Impact and sustainable investing resonate more strongly than digital assets, with 37 per cent already invested in impact and ESG strategies. The surveyed next generation’s interest in impact investing is especially pronounced among women students and younger respondents. One in four also invest in private markets, and almost one in five make direct investments, often to diversify portfolios and gain exposure to non publicly-traded markets, the report reveals.

Enthusiasm for newer asset classes such as digital assets is more muted. Among those who actively manage their investments, 11 per cent are invested in cryptocurrencies.

However, when asked about what areas concern them the most, technology and artificial intelligence (62 per cent) ranked top, followed by poverty and inequality (49 per cent) and education (41 per cent).

Globally, 41 per cent of next-generation respondents associate wealth transfer with a shift in responsibility, compared with 38 per cent who associate it with the passing of a family member. In North America, up to 67 per cent associate wealth transfer with responsibility, while in APAC and Latin America, around 60 per cent still associate it primarily with the death of a family member.

Wealth conversations start too late
The report shows that 33 per cent of surveyed next-generation family members said their families are already transferring wealth, with a further 25 per cent either actively planning or planning with advisors. However, more than half said that wealth conversations start too late.

While around 44 per cent first discussed wealth in early adulthood, 37 per cent during their teenage years, and 17 per cent in childhood, 56 per cent believe that parents should engage in the topic earlier, ideally during childhood or adolescence.

Among those who report feeling tension about wealth transfer, 33 per cent cite communication gaps or avoidance as the primary source of conflict, more than disagreements over lifestyle, spending, or fairness.

Peers rival private bankers as a source of advice
When making succession decisions, 27 per cent of next-generation respondents said peers are their most important source of advice, ahead of wealth managers/private banks (21 per cent). Seventy-eight per cent also said that networking opportunities are the most important “extra” that makes a financial services provider stand out, ranking above legal, tax, concierge, or relocation services.