More than $84 trillion in wealth transfer will take place in the U.S. by 2045.
The numbers tell the story behind this massive generational wealth shift. Cerulli projects that $72.6 trillion in assets will transfer to heirs through 2045, while $11.9 trillion will go to charities. Greater than $53 trillion will transfer from Baby Boomer households alone. Yet the latest Cerulli Edge: U.S. Advisor Edition warns that more than 70% of heirs are likely to fire or change financial advisers after inheriting their parents’ wealth.
This represents the largest asset retention crisis in financial services history.
What the “Great Wealth Transfer” Looks Like Today
Forget the traditional inheritance model where wealth sits locked until the reading of the will. Today’s intergenerational wealth transfer is complex, slower, and harder to predict. Baby Boomers aren’t waiting for estate planning formalities. They’re gifting while living. College tuition payments of thousands of dollars per year. Down payments on homes. Lavish family vacations to create memories while they can still travel. According to a survey, 54% grandparents have reported being the primary planner and organizer for a multigenerational trip This “give-while-living” approach means wealth is already moving, often without formal advisor involvement. Longer retirements paired with escalating healthcare costs mean slower, smaller payouts than previous generations experienced. Where once a $10 million estate might transfer intact, today’s reality involves years of incremental distributions for assisted living, medical care, and lifestyle maintenance. The assets themselves tell a complex story. Modern wealth isn’t just stocks and bonds—it spans houses in multiple states, inherited IRAs with complex distribution rules, family businesses, digital assets, and even sentimental holdings like art collections, bitcoin, or vintage cars. Each category demands specialized knowledge that traditional wealth advisory often lacks. Forbes research by Joseph Coughlin reveals another wrinkle: today’s wealth holders view money as a tool for experiences and value expression, not just accumulation. This philosophy shift creates misalignment with wealth advisors focused purely on portfolio optimization.Two U.S. Policy Shifts in 2025-26 You Can’t Ignore
Two major tax law changes are creating unprecedented urgency around wealth transfer planning in the U.S.—and many wealth management firms remain unprepared.Estate Tax Exemption Halves January 1, 2026
The current federal estate tax exemption of $13.61 million per person drops to approximately $7 million unless Congress intervenes. For married couples, that’s a reduction from $27 million to roughly $14 million in protected wealth. Recent legislative proposals suggest the exemption might increase to $15 million, but no bill has become law. Waiting for congressional clarity means missing the window for strategic advance gifting. The math is simple: a $20 million estate faces zero federal tax today but could trigger $5.2 million in taxes after the estate tax sunset in 2026: a 26% wealth destruction that advance gifting could prevent. Yet IRS data shows gift tax filings remain flat despite this looming deadline.SECURE Act Creates 10-Year IRA Drain
The SECURE Act eliminated the “stretch IRA” provision for most non-spouse beneficiaries, creating a mandatory 10-year distribution window for inherited retirement accounts. This rule forces heirs to empty inherited IRAs within a decade, often during their peak earning years when tax rates are highest. Consider a 45-year-old heir inheriting a $2 million IRA. Under old rules, distributions could stretch across her lifetime, minimizing annual tax impact. Now she must withdraw $200,000 annually for ten years, potentially pushing her into higher tax brackets and triggering significant wealth erosion. This change affects millions of inherited retirement accounts across the country, yet many wealth advisors haven’t stress-tested their client portfolios for SECURE Act implications or developed distribution strategies to minimize tax damage.Why Wealth Firms Risk an AUM Exodus
The statistics paint a stark picture for traditional wealth management. Cerulli Associates’ research shows 70% of heirs terminate relationships with their parents’ financial advisors within two years of inheritance. Some studies push that figure even higher. The generational divide runs deeper than simple preference differences. Accenture research reveals that 95% of Gen Z consumers would consider wealth management products from technology companies like Google or Apple over traditional financial institutions. Brand loyalty that took decades to build can evaporate with a single app download. Fee compression adds another layer of pressure. Robo-advisors and fintech platforms offer portfolio management at 25-50 basis points compared to traditional wealth management fees of 100-150 basis points. For a $5 million inheritance, that difference represents $37,500 annually, enough to fund a luxury vacation or private school tuition. The competitive landscape has fundamentally shifted. Where wealth management once operated as a relationship-driven oligopoly, today’s heirs view financial services as a commodity available from multiple providers with transparent pricing and superior technology interfaces. Cultural misalignment compounds the retention challenge. Traditional advisors built careers around in-person meetings, printed statements, and phone-based communication. Next-generation clients expect mobile-first interfaces, real-time portfolio access, and digital-native service delivery.What Next-Gen Heirs Actually Want
Understanding heir-preferences isn’t guesswork. Extensive research reveals clear patterns in what younger generations demand from wealth management relationships. Mobile-first technology sits at the foundation. Heirs expect always-accessible portals showing real-time portfolio performance, transaction history, and planning scenarios. They want secure messaging capabilities, document upload features, and mobile-optimized interfaces that work seamlessly across devices. Environmental, social, and governance (ESG) investing has evolved from nice-to-have to table stakes. An Accenture report shows that 59% of younger generation inheritors consider ESG factors essential in investment decisions. They’re willing to accept slightly lower returns for portfolios aligned with their values, but won’t compromise on having those options available. Fee transparency ranks among the top concerns. Heirs want plain-language explanations of what they’re paying for and what services those fees get them. Complex fee structures buried in lengthy disclosure documents create immediate trust issues that often trigger relationship termination. Financial literacy education represents a massive opportunity. Rather than patronizing lectures about market basics, heirs want practical education about wealth preservation, tax optimization, and philanthropic strategies. They prefer bite-sized learning modules delivered through digital channels over traditional seminar formats. Communication preferences skew heavily toward written over verbal interaction. Text messages, secure chat platforms, and email updates are preferred over phone calls or face-to-face meetings for routine portfolio updates and administrative matters.Why Technology Modernization is the Key to Multi-Generational Retention
Technology modernization isn’t just about the heirs’ preferences—it’s about operational efficiency. Firms with digital-first service delivery models report higher advisor productivity and significantly lower operational costs per client relationship. Invest in client vault systems for secure document storage, real-time portfolio access, and mobile-optimized interfaces. Implement secure chat functionality for routine communication and consider AI-powered nudges for important planning deadlines or market updates.Ready to transform your wealth management approach?
Wealth management companies collaborate with QualityKiosk to ensure data quality validation, facilitate migration to core systems such as Avaloq, Temenos, FNZ, Broadridge and conduct testing of digital advisors and other digital applications. This partnership aims to guarantee accurate, compliant communications and seamless user experiences. Contact QK for a complimentary assessment today.
Amit Kishore
EVP, Capital Markets, QualityKiosk Technologies
Amit Kishore is an experienced senior technology leader with over 25 years of experience in the financial and technology services industry. He has held leadership roles at prominent firms such as Broadridge, Goldman Sachs, Fidelity Worldwide Investment, Macquarie Group, and Royal Bank of Scotland, driving large-scale digital transformation initiatives across the financial markets and wealth management spectrum.
As the Executive Vice President of the Capital Markets division at QualityKiosk Technologies, Kishore closely collaborates with the senior leadership, sales, and technology teams to deliver customer-centric digital financial solutions.
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