As the first babies of Gen X approach their 60th birthdays, a massive generational transfer of wealth has already begun. With American wealth increasingly under “new management,” our 2024 Study of Wealthy Americans reveals how viewpoints differ across generations and across wealth journey, meaning the life path that brought people to wealth.
2024 Study of Wealthy Americans
A generational divide in investing, giving and preserving wealth.
Older and younger generations are surprisingly far apart on many investment issues, which could change allocation trends as wealth transfers to younger Americans. Comparing Gen Z and millennials to Gen X, baby boomers and seniors, views diverge on outlooks and portfolio construction. These differing opinions are also seen in the opportunities for growth in today’s environment. The younger wealthy people are increasingly looking beyond the traditional stock and bond markets to build their wealth and are driving demand for everything from real estate and private equity to digital assets and gold. The older set favors domestic equities, real estate and emerging equities.
Traditional investments outranked for younger investors
Greatest opportunities for growth
“We’re living through a period of great social, economic and technological change alongside the greatest generational transfer of wealth in history. This study shows that wealthy Americans are focused on diversification, long-term goals and making a lasting impact with their wealth.”
— Katy Knox, President of Bank of America Private Bank
Purpose and passions
Next-gen views on philanthropy, inheriting art and more
The younger cohort is also more inclined than their parents to say they share the same commitment to giving back. Again we saw less confidence in older generation on that question. A deeper disagreement emerged over their approaches to philanthropy goals. Older people say their children are taking the same approach as them, while younger people do not agree.
Generations do not see eye-to-eye on philanthropy approach
Philanthropy approach among parents and children
Estate planning
The hidden stresses of wealth transfer
Interpersonal family dynamics are the most frequent culprit for inheritance-related strain, particularly cited by older wealthy people. The unequal distribution of assets is another common cause. Governance issues, including lack of instructions, communication and trust, are also prevalent, especially for younger wealthy people. Hard assets like jewelry and heirlooms can factor into these scenarios – yet they’re only included in estate planning about half of the time.
Interpersonal family dynamics are a top driver of strain
Reasons for strain
As wealth shifts toward the younger generations, these perspective differences could drive new patterns and trends in financial decision-making. The very human experiences that go into shaping these viewpoints are valuable to understand, both for the investors themselves and for the advisors looking to support them with guidance.
This research represents American adults with $3 million or more in investable assets. It was designed to be a statistically representative sample of the population in the U.S. that meets these two criteria. This survey was conducted by Bank of America Private Bank in partnership with research firm Escalent and was fielded in January through February of 2024.
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