Biggest Wealth Transfer To Next Generation To Take Place In Americas: UBS Report
On an average, people passing on wealth are just over 84 years old, and the recipients they pass it to are approximately 59 years old.
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The most substantial horizontal and vertical wealth transfer to the next generation will take place in the Americas, according to the 2024 edition of the global wealth report by UBS Global Wealth Management.
"Liquid, bankable financial wealth makes up only just under a third of total transferable wealth in Europe, the Middle East and Africa, but almost 40% of it in Asia-Pacific and nearly 58% in the Americas, where the biggest horizontal and vertical wealth transfers will take place," the report said
The report said that the Asia-Pacific region has over three times as many people above the age of 75 as the Americas. And that it also has more than twice as many as Europe, the Middle East and Africa. It expects the Asia-Pacific region to lead in terms of the instances of wealth transfer, however, not in terms of the amount of wealth that will be transferred, due to the region’s lower average wealth per adult compared with other regions.
It said that on an average, people passing on wealth are just over 84 years old, and the recipients they pass it to are approximately 59 years old.
"Approximately $83 trillion are expected to be passed on within the next 20 to 25 years. However, given that people over the age of 75 hold nearly one-fifth of the world’s overall wealth, and that the average life expectancy for 75-year-olds ranges between 82–86 years across most of the world, a large chunk of these assets can be expected to be transferred already within the next ten years," the report said.
The company estimates that $9 trillion of wealth will be transferred intra-generationally, or horizontally, between spouses.
"It is often overlooked that before being transferred from one generation to another, wealth is frequently passed on within the same generation between spouses. Life expectancy varies between men and women, and quite frequently couples have an age gap, therefore the inheriting spouse will typically own and hold onto this wealth for an average of four years before passing it on," the report stated.
The data also estimated that over 10% of the $83.5 trillion to be transferred is likely to be done by women to the next generation.
