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Ready for the great wealth transfer?

Journalist: Carmen Reichman, FTAdviser

ended 25. July 2024

Dear advisers

The great wealth transfer is estimated to be worth £5.5tn over 30 years.

But research shows a mere third of advisers have a plan for this inheritance wave. Do you?

How do you ensure the money stays with you after a client death? Do you do your own probate for instance?

Do you use family linking on wrap services?

At what point do you engage with people's beneficiaries and what's your strategy for doing so?

Do you use tech to engage the next generation?

What are your biggest concerns in relation to the great wealth transfer?

I'm keen to hear from all those who have a strategy in place and everyone else who has views on this topic!

It's for a better business article on FT Adviser.

Thank you!

Carmen

carmen.reichman@ft.com

 

2 responses from the Newspage community

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Editor
Paul Denley
CEO at Oakham Wealth Management
Engaging inheritors early on in the relationship is crucial if you want to optimise your chance of retaining the family portfolio when wealth is passed on. Younger members should be encouraged to open small portfolios, such as ISAs, to build an understanding of investing. Even better if these portfolios are self-managed, which will promote engagement and, hopefully, highlight the value of advice, even if the young investor makes an error or two – this is invaluable experience!
Technology should be harnessed and designed to appeal to a younger audience. From digital signatures to an up-to-date client portal, it’s important to show we are not dinosaurs.
Our main concern regarding wealth transfer is the younger generation's potential interest in higher-risk investments such as crypto or early-stage tech. Having witnessed explosive growth in assets such as Bitcoin and Tesla, the next gen may also expect unrealistic returns year-on-year and overlook the importance of diversification.
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Kundan Bhaduri
Property Developer and Portfolio Landlord at The Kushman Group
Most of our family assets are in real estate property. I am currently working closely with a financial advisor to secure our assets for the next generation.

First and foremost, for anyone that doesn't have a will - for God's sake, make one. It doesn't cost much and can save your kins several hundreds of thousands in IHT. Have mirror wills with your spouse if most of your assets are jointly and equally owned. The second most important element is to know what assets to protect and for whom - make this clear in your will. In our case, we hold most of our real estate in limited companies that are in a nested group structure.

Limited company structures are a great way to plan inheritance, as one can gradually introduce children into the company's shareholding in small chunks after they turn 18. It might be advisable for the shares of the group holding company to be held in a trust structure, so that ultimately, these do not become part of your estate after your death.