Girls eager to inherit $9 trillion

Up to $9 trillion is expected to be handed over to spouses and partners as part of “horizontal wealth transfer” in the coming years, according to an ancient record.

Over the coming 20 to 30 years, the wealth of funds and public individuals belonging to the rising boomers and used-to generations is expected to surpass $84 trillion. Younger generations, including Preseason X, Millennials and Preseason Z, are expected to inherit the majority of the inheritance.

But since surviving spouses and partners receive the initial inheritance in most cases, and since women outlive men in most cases, bequests will largely go to women in the coming years, according to the UBS World Wealth Record.

According to the document, an estimated $9 trillion will be transferred “inter-generationally,” meaning from one partner to another.

“Life expectancies differ between men and women, and there is often an age gap within couples, so the inheriting spouse will typically own the property before passing it on,” the document says. Will keep it with itself for an average of four years.”

UBS calls this “horizontal wealth transfer”, because wealth is being transferred inter-generationally rather than intra-generationally. And in the past small, patchy, horizontal transfers it is possible to reshape wealth control, creating an investment and leisure spending park that has been largely ruled by men.

“Most people have a feudal view of wealth diminishing across generations,” said Paul Donovan, chief economist at UBS World Wealth Control. “But about 10% are likely to be passed on to spouses or partners and not yet pass it on to children, although this will change over time.”

According to the document, the largest horizontal money transfer will likely take place in the US. There are more than 43 million people in the region over the age of 75, who hold more than $50 trillion of combined transferable wealth. The average date of people passing through the sick property is over 85, the document said.

Since few families can transfer fortunes directly to future generations, inheritance can usually be a two-step process – first passing to the surviving partner and then passing through that partner to the ill-fated future. (In most cases estate law allows the surviving partner to inherit a property of unlimited value without being subject to estate tax).

The document estimates that if the next $9 trillion is handed over to spouses, they will bequeath more than $8.4 trillion to future generations, making them key solution makers in appreciable wealth transfer.

These transfers, combined with other broader forces within the financial system, are adding up to the so-called “feminization of money.” As women’s earnings and wealth increase, along with legacies for both older and younger heirs, analysts expect women to make up an increasing percentage of top net worth traders and clients.

According to Julius Baer, ​​more than 11% of the region’s millionaires are now girls, almost double the number in 2016.

The biggest impact will probably be on money controls. Donovan said that 45% of UBS’s wealth buyers are actually women.

“This is important when it comes to money management,” he said. Wealth Control Buyers, he said, “will be different people, with different ideas and different things they want to do with their money.”

A McKinsey document estimates that most of the $30 trillion in baby boomer wealth by 2030 is expected to be controlled by women. While the wealth control business has currently been traditionally ruled by male buyers and male advisors (accounting for 85% of the workforce), McKinsey said that is rapidly changing.

“After years of playing second fiddle to men, women are ready to take center stage,” the document said.

McKinsey said that compared to five years ago, 30% more married women are making financial and investment decisions, and more women are public earners than ever before, “fueling growth in their investable assets.” ”

Even luxury manufacturers historically targeted toward men are adopting. Amidst the great hold in the market, women’s watches are one of the fastest growing departments. Bulgari CEO Jean-Christophe Babin told me earlier this time that “the trend is towards more feminine and more unisex watches. Women’s power is increasing in terms of independence, autonomy and purchasing power. We think this will continue .”

Philanthropy may also have the additional benefit of horizontal wealth transfers. Contributing to girls and teams that think about girls increased 9% in 2020, to more than $8 billion by late fall, according to the Girls Philanthropy Institute at Lily Lok College of Philanthropy.

Melinda French Gates has pledged $1 billion to women’s and young girls’ causes, and MacKenzie Scott has donated more than $17 billion of her wealth since 2019, including a massive grant to the Girl Scouts of America .

“We will see a dramatic shift in the ownership of wealth,” Donovan said. “It will be very important to see who controls the resources that finance the global economy.”