X Marks the Spot

MCF Intersection

A regular snapshot of the trends, news and research in the world of philanthropy — and its impact on business.


A major generational transfer of wealth will take place over the next quarter century, and financial advisors need to be prepared.

Those are important takeaways from a new Cerulli Associates report, which says almost 45 million U.S. households will transfer a total of $68 trillion to their heirs or charity over the next 25 years.

The report, titled “U.S. High-Net-Worth and Ultra-High-Net-Worth Markets 2018: Shifting Demographics of Private Wealth,” finds that of the households transferring wealth, baby boomers will make up nearly 70% of the total, or about $48 trillion.

And who will be the primary beneficiaries of that generation’s transfers? Generation X, whose members were once pegged as cynical slackers. At the end of the next 25 years, Gen Xers will take over as the generation with the greatest wealth.

This means financial advisors and planners need to build deep, longstanding relationships with this demographic, says Asher Cheses, a Cerulli analyst quoted in the news release announcing the report.

Millennials will also begin inheriting wealth, too, and high-net-worth advisory practices need to focus on building multigenerational relationships with clients, he adds.

“Multigenerational wealth planning can be costly and requires a well-thought-out process,” Cheses says. “The firms that are able [to] develop a successful strategy to not only service the evolving needs of baby boomers, but also effectively engage the next generation of inheritors will likely retain the greatest share [of] assets in the coming years.”