(Cryptosaurus) - A new study from BNY Mellon Wealth Management and Campden Wealth shows that the next generation of the super wealthy are eager to take the reins with a strong focus on the technology of the future. But some family offices think they’ve got what they need.
The study, “The Next Generation of Wealth Holders in the United States 2022,” surveyed ultra-high net worth individuals who have recently or in the future assumed control of family wealth. The study’s respondents had an estimated total household wealth of $77 billion and an average net worth of $752 million per household.
According to the study, the Next-Gen highly indicate they are prepared for succession in the family enterprise, with 85% reporting they feel either very or somewhat prepared. But Campden Wealth’s 2022 research on family offices shows a clear disconnect exists, with only 39% of family offices saying the next generation is adequately prepared for succession.
Rebecca Gooch, director of research at Campden Wealth, said: “In the midst of the largest wealth transfer in US history, the next generation of asset holders understand and embrace the seriousness of this important responsibility for a long-lasting family legacy. ” a statement. “They want to live up to their families’ expectations and make a positive impact on the world but face challenges with a successful transition based on complex family dynamics, understanding and formalizing their role after succession.” Absence of succession plan.”
More than three-quarters of Next Generation respondents say they are driven by a desire to diversify away from traditional investing, and 70% want to invest in a sector before it becomes mainstream. Respondents said that investing in digital assets/new technology after taking control is also of great importance.
Within the next year, 60% of Next Generation people plan to increase their exposure to artificial intelligence and fintech, and 53% will do the same in the field of robotics. When it comes to cryptocurrency, those active in the space plan to remain committed, with more than half (57%) ready to retain and 43% planning to increase investment in cryptocurrency.
Leo Grohovsky, Chief Investment Officer at BNY Mellon, said, “Consistent with the study, we have observed that many of our next-generation wealth clients approach their investment strategy with a growth-oriented mindset and a deep sensitivity and passion to incorporate sustainable investing ” Wealth Management said in a statement. “The next generation is also breaking the mold of their parents’ generation by embracing alternatives and new technologies, but being thoughtful and measured about including digital assets in their portfolios.”
The study also found that the next generation is showing an interest in reducing conflict within the family enterprise. Two-thirds believe in the power of regular communication, and another 63% seek outside support for their succession planning/wealth transfer. Despite respondents’ eagerness to engage, their family members’ roles and responsibilities and concerns over business strategy rank as barriers to smooth wealth transfer.
Concern about their preparedness aside, the next generation hungers for growth and to shake up the family enterprise. Once in control, 27% plan to move to alternative investments, while another 24% want to integrate new technologies such as blockchain and AI into the family office.
More than half of the respondents (51%) surveyed believe that one does not have to sacrifice returns to invest sustainably, and more than two-thirds (68%) say that sustainable investing Investment has become a permanent feature of the landscape.
By Rodney Holmes
