Women on the wave of wealth transfer

$84 trillion is set to transfer between generations, and women are emerging as key players in the shift. As they take charge of financial decisions and asset management, the demand for personalized financial advice is crucial.

There is currently a massive intergenerational wealth transfer underway between the Silent Generation and Baby Boomers to younger generations. The $84 trillion ‘great wealth transfer’ is expected to take place over the next two decades¹, and women stand to inherit a sizable portion--leading many to wonder if women will be the next wave of growth in wealth management.

Women are managing more wealth than ever before. They now control about one-third or $14 trillion of total US household assets, and $4.92 trillion in Western Europe with more women making financial and investment decisions in their households than previously². In fact, 72% of global women surveyed said they invest at least monthly, and 16% invest a third or more of their monthly income².

According to some estimates³, however, American women are expected to control much closer to 100% of US household financial assets by 2030 (around $30 trillion) as men pass and cede control to their female spouses who tend to be both younger and live longer. Similar wealth transfers are expected to take place in markets from Hong Kong to Mainland China, and the UK.

Time to tailor financial advice

To navigate the great wealth transfer, women will need professional financial guidance, but it is not a demographic that financial advice firms have historically focused a lot of their attention on. In the US, for example, 70% of women say they’ve never met with a financial advisor, compared to 41% of men³. In the UK, only 7% of wealth managers say they have a differentiated sales and marketing strategy for female investors².

By some estimates, American women are expected to control close to $30 trillion of US household financial assets by 2030.

As this wealth transfer picks up pace, there is significant growth opportunity for financial advisors who not only have the skill and expertise to navigate an ever more complex financial landscape, but who also understand the unique set of financial issues women face.

Sources:

¹ Cerulli Associates: U.S. High-Net-Worth and Ultra-High-Net-Worth Markets. https://www.cerulli.com/press-releases/cerulli-anticipates-84-trillion-in-wealth-transfers-through-2045

² Source: World Economic Forum, The Future of Financial Advice, July 17, 2024. https://www.weforum.org/publications/the-future-of-financial-advice/

³ Source: McKinsey & Company, Women as the next wave of growth in US wealth management, July 29, 2020. https://www.mckinsey.com/industries/financial-services/our-insights/women-as-the-next-wave-of-growth-in-us-wealth-management