Tag: Family Wealth

We are in the early innings of the largest intergenerational wealth transfer in modern history. Over $100 trillion in assets is expected to pass from baby boomers and older generations to their heirs in the coming decades, with approximately $60 trillion of that held within the wealthiest 2% of households (Cerulli Associates).

What makes this transition unprecedented is not just the size of the capital, but also the orientation of its recipients. Many of these future inheritors may be first-generation wealth creators in their own right: technologists, private investors, digital entrepreneurs. If they aren’t creators, they inhabit and are influenced by a world that is less bound by tradition, more shaped by systems thinking, and is ultimately volatile, highly networked, and fast-moving. Increasingly, they regard legacy wealth infrastructure as outmoded and optimized for preservation rather than innovation.

The institutional reflexes of legacy firms are coming under scrutiny. A 2023 Capgemini report revealed that 81% of next-generation millionaires intend to switch wealth managers. This is not simply about generational disconnects or service preferences. It represents a strategic repositioning away from the cross-selling product driven mindset of wealth management toward something more dynamic: capital as a platform, not a fortress.

The Need for a Multi-Disciplinary Ecosystem

The traditional model of wealth management was built on singular trust relationships: one advisor who served as gatekeeper, generalist, and confidant. This model was efficient in a pre-digital, slower-moving financial landscape. Today, however, complexity has become the default condition of affluence.

Wealthy families now encounter overlapping spheres of activity: liquidity from venture investments, cross-border regulatory considerations, estate planning layered with philanthropy, and emerging asset classes that resist traditional valuation. The wealth team of the future resembles less a family office and more a modular platform: one that integrates specialists across domains and geographies.

According to UBS, 60% of wealthy millennials already work with multiple advisors, including CFO-style leads, liquidity event specialists, philanthropic consultants, and crypto-savvy allocators. These are not just transactional relationships; they reflect a new ethos of wealth leadership; one grounded in orchestration rather than delegation.

The emerging architecture of a modern wealth team might include:

• An equity strategist with fluency in secondary markets, cap tables, and post-exit planning
• A philanthropic architect who designs legacy through impact vehicles, donor-advised funds, and blended capital models
• Legal counsel adept at cross-border structuring, digital asset custody, and anticipatory estate design
• A lead advisor who operates more like a chief strategist or portfolio architect, aligning capital to a set of interlocking personal, professional, and societal goals
• Specialists across geopolitics, deep-tech, climate, Bitcoin, and other domains whose unique and high-touch insights help inform an innovative and resilient portfolio

This distributed model is not simply a response to complexity. It reflects a broader shift in how the next generation thinks about decision-making itself—decentralized, interdisciplinary, and system-aware.

Real, Human Relationships Powered by Digital Accumen

Digital transformation is not just a service channel upgrade; it represents a mindset shift in how wealth is measured, understood, and governed. Unlike previous generations who may have relied on quarterly reports and annual reviews, younger UHNW clients expect real-time data visibility, scenario modelling, and autonomous oversight tools.

According to Deloitte, over 70% of affluent millennials prefer digital-first financial services. But the real implication lies beyond surface-level preference: these individuals are pattern-recognition natives, trained by algorithmic thinking, agile development, and rapid feedback loops. Firms that see technology as just a way to deliver services, rather than as something that should shape how those services are designed, are falling behind. Today’s clients no longer accept delays or clunky processes in exchange for a high-touch experience. In their view, friction isn’t just inconvenient; it signals risk. It suggests poor alignment, missed opportunities, and a lack of relevance in a fast-moving world.

A worldview shaped by digital systems and a preference for autonomy over intermediation also impacts how emerging asset classes are considered and managed. Bitcoin, for example, is no longer a speculative fringe asset, it is a strategic allocation. Viewed as a hedge against inflation, institutional fragility, and fiat debasement, Bitcoin appeals not just financially but philosophically. For many, holding Bitcoin is as much about conviction as it is about return. Advisors serving this cohort must understand not only its investment case, but also its custody, tax treatment, planning integration, and long-term implications.

It takes a combination of real human relationships and digitally intuitive solution to deliver the right outcomes for the new stewards of generational wealth as they set out to navigate a complex and fast-moving world with geopolitical and technological trends in flux.

Purpose as a Structuring Principle

The intergenerational shift in wealth priorities is perhaps most visible in the rise of values-based investing. But even this framing may be too narrow. For many next-gen wealth holders, capital is a means of self-expression, identity, and agency. ESG is not a strategy overlay; it is often the foundation of their investment thesis.

A 2023 Morgan Stanley survey found that 84% of millennials are interested in ESG investing, compared to just 45% of baby boomers. But the real divergence lies in how these generations define value. Where previous generations might have prioritized wealth preservation and minimal volatility, younger inheritors are increasingly comfortable trading some degree of short-term risk for long-term alignment with personal or societal missions.

More importantly, many are bypassing public ESG funds in favor of direct investments in mission-aligned ventures, co-investments in sustainable infrastructure, and thematic funds focused on climate, diversity, and inclusive innovation.

This shift requires advisors not just to understand ESG scoring methodologies, but to contextualize them within broader geopolitical, demographic, and technological trends. While a portfolio should reflect one’s values, the priority for the next generation of inheritors is whether their investment decisions can drive structural change in the domains that matter to them.

Beyond Succession

Perhaps the most misunderstood aspect of this wealth transfer is the assumption that it is primarily an exercise in succession. In reality, we are witnessing an assertion of strategic inheritance—the act of actively reinterpreting what wealth is for, how it is deployed, and which systems it should influence.

For UHNW individuals who straddle both the first and second generations—those who have built wealth through innovation and are now receiving it as stewards—the boundaries are blurring. Their mandates are not backward-looking (preserve) or purely present-focused (optimize), but fundamentally forward-oriented: what institutional economist Elinor Ostrom once called “long game rationality.”

In this view, wealth is no longer a static store of value. It is a tool for governance, influence, and design. Those advisors and institutions who can engage at this level—not merely managing portfolios, but architecting futures—will become indispensable partners in an era where money alone is no longer the differentiator. The differentiator is resilient and innovative design.

Bespoke Group was founded on the premise that the next generation of wealth demands a fundamentally different advisory model: one that is agile, deeply informed, and purpose aligned.

If you’re exploring how to align your wealth with long-term purpose and strategy, we invite you to connect with us. Whether you’re establishing a family office or rethinking an existing structure, Bespoke offers discreet, high-touch advisory tailored to your needs. Contact us to schedule a confidential consultation—we’re here to help you navigate what’s next with confidence and intention.

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This information is intended for general educational purposes only and should not be construed as legal or investment advice.

Preparing Heirs for Responsibility, Not Just Access

Many of our clients express concerns about preparing their heirs for what they perceive to be the social responsibility of inheriting wealth. While not all clients share this view, those who do tend to feel particularly strongly about the need to prepare their descendants for this responsibility, which often translates to philanthropy. This article addresses how families with this worldview can prepare younger generations for inheriting wealth in a socially responsible manner.

A Simple Life Lesson

The Lilly Family School of Philanthropy at Indiana University conducts extensive research on philanthropic behaviors across lifespan. This seems intuitive enough, but their studies consistently suggest that early exposure to philanthropic activities can significantly influence one’s propensity to engage in giving and volunteering in adulthood.

Years ago, a colleague described to me the steps she took to educate her young children in social responsibility and philanthropy. In addition to modeling with her own giving, once each of her children attained eight years of age, during the holidays that child would be “given” $50 to donate to charity. My colleague would also teach that child how to use charitynavigator.org and guidestar.org to research the charities that most efficiently address the causes the child wished to support.

In this way, her children not only learned about philanthropy, but they also learned the importance of evaluating charities so they could give more effectively. As her children grew older, my colleague would periodically increase their annual charity allocation until, upon attaining 18, she would give $500 to the child for a donation to his or her favorite charity or charities. This simple lesson provides the framework for how the family can educate younger family members about social responsibility.

The Role of Legal Structures in Teaching Social Responsibility

Private Foundations

Wealthy families typically have at least one legal structure through which socially responsible education can take place. Historically, wealthy families have used private foundations as the cornerstone for this education. With a private foundation, heirs could serve as members of the foundation’s Board of Directors or, alternatively, could serve in a more limited advisory role (e.g., to determine specific grant recipients) to the Board. In this way, young family members can begin learning about philanthropy – and seeing its impact – before reaching their teen years.

However, utilizing a private foundation for this education has limitations. First, members of the Board have a fiduciary duty that is often overlooked. Thus, placing minors in this position is ill advised. Moreover, a role with the family’s private foundation is, at best, limited to that foundation’s charitable activities. If it is a grant-making foundation, the activities are limited to its grants; if it is an operating foundation, the heirs may also be able to experience the “hands on” charitable work being done by that foundation.

Regardless of the type of foundation (operating vs. non-operating), involving heirs in only the foundation has additional limitations. First, the family’s philanthropy is often accomplished through multiple avenues, not just a foundation. For example, the family may have one or more charitable trusts. Thus, the foundation offers only limited transparency into the family’s total philanthropy.

In addition, many wealthy families also utilize impact investing to create a social impact with their non-philanthropic assets. By definition, involvement limited to the family’s foundation can, at best, provide visibility only to the investments of the foundation. Since foundations frequently encompass only a fraction of the family’s wealth, visibility limited to the foundation does not give heirs a complete picture of how the family’s wealth – not just its philanthropic dollars – are impacting society. Ideally the heirs have transparency as to the totality of the family’s impact, with at least some say in the areas impacted.

As an aside, Donor Advised Funds have gained in popularity in recent years due to their simplicity, reduced costs, and lack of compliance headaches as compared to private foundations. In theory, an heir’s participation in the family’s donor advised fund would be substantially similar to their participation as an advisory member of the family’s private foundation’s board.

Private Trust Companies

A relatively recent legal development, the advent of Private Trust Companies, is changing how family’s address philanthropy and thus social responsibility with intergenerational wealth. A Private Trust Company (PTC) is a trust company controlled by the family and established specifically to serve as the trustee of the family’s irrevocable trusts. (PTCs are in response to the perceived conflict, particularly with younger generations far removed from trust creators, between descendants, on the one hand, and trustees, on the other.)

PTCs are currently available by statute in only a limited number of jurisdictions, but most of these jurisdictions not coincidentally are also the top U.S. trust jurisdictions due to their favorable trust laws. Our preferred PTC jurisdictions are Nevada, South Dakota, and Wyoming, but others also have merit.

General PTC management is provided by a Board of Managers, typically comprised of family members and independent outsiders, including an administrator in the selected jurisdiction. Significantly, the family can select which jurisdiction’s laws are most appropriate and advantageous for them, given their assets, goals and objectives, desire for a regulated versus unregulated PTC, etc.

More granular PTC management is provided by a handful of PTC committees, which often include the following:

• Philanthropy Committee
• Investment Committee
• Owner Education and Family Governance Committee
• Discretionary Distribution Committee
• Amendment Committee
• Audit Committee

The first three of the committees listed above may be limited to family members, and the Philanthropy and Investment Committees in particular create the opportunity to give heirs a holistic view of the family’s philanthropy and socially impactful investments; as the heirs age, their participation can increase accordingly, giving them increased visibility in their areas of interest. For younger heirs, sub-committees allow targeted, limited participation in these key areas.

Also relevant here, the Owner Education and Family Governance Committee creates the framework for participation and decision-making going forward. More specifically, this Committee develops the family’s policies and guiding vision and values that regulate family members’ roles, rights, and responsibilities with the family enterprise and with each other. The overall goal of these activities is to prevent the splintering of the family and family enterprise in future generations. Studies show that the potential splintering of the family is far more likely to dissipate intergenerational wealth than loss of capital, particularly as the family moves multiple generations away from the original wealth builder(s).

Conclusion

The legal structure(s) adopted by the family can have a significant impact on younger family members’ understanding of social responsibility and philanthropy. More so than a private foundation, a private trust company can give the family an ideal training ground for teaching social responsibility, and PTCs provide multiple avenues for encouraging areas of interest, including philanthropy and investments via committees and sub-committees. When generational wealth is at play, a PTC can provide a structure that encourages family harmony over generations, reducing the likelihood of wealth dissipation.

PTCs are not a panacea, however, and there are hard costs and administrative burdens the family should consider. But under the right circumstances, a PTC may provide the best structure for family involvement in social responsibility, while also providing a succession vehicle for the family’s intergenerational wealth.

The Bespoke Group provides strategic guidance at every step—helping you design an ideal structure and personalized giving strategy that reflects your values, ideals, and passions. We work closely with you to ensure that both your structure and philanthropy drive meaningful impact in the areas that matter most.

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If you’re interested in learning more about Bespoke’s approach to private wealth management and how we can help you build a secure financial future, we invite you to reach out to us directly. We’d be happy to set up a confidential consultation at your convenience.

Thank you for considering Bespoke as your partner in wealth management. We look forward to the opportunity to work with you.

This information is intended for general educational purposes only and should not be construed as legal or investment advice.