How HNW Millennials and Gen Zers View Their Wealth

Fulfilling the “family” element may be simpler for the next generation, especially if they were born into a family with an estate plan in place, which allows them to turn their attention to making an impact elsewhere.

Having greater ease in planning for the self or family will allow them to have a more intentional, immediate impact through philanthropy, offering instant gratification that they are putting their wealth to work and making a difference today.

It’s important to determine what excess wealth looks like for each client based on their spending and then implement a plan for what’s left over based on what’s truly important to them.

A Refreshed Vision of Philanthropy

As the next generation focuses on giving back to the community, the shift will not only be in their monetary donations, but in their philanthropic interests as well. Their parents may have prioritized a more personal involvement in their charitable giving by sitting on the board of a foundation or working with friends and families to give back on a local level.

Philanthropy has not only been a positive way to give back, but affiliations with organizations is also often a critical part of their social lives and self-identities.

The next generation, however, is more interested in making a difference on a global scale.

Rather than being highly involved with one organization, they tend to focus more on maximizing the impact of their charitable giving and cast a wider net to give back outside of their own communities.

Broader global issues like climate change or racial injustice will often take precedence over local community groups.

The differences between generations are neither good nor bad. They are, however, critical factors that advisors should be preparing to address when it comes to their families’ estate plans.

As millennials and Gen Zers begin to hold the majority of the world’s wealth, we should expect that their needs and expectations will look vastly different from their parents’, and now is the time to initiate conversations to support them.

Kelley Wolfington is senior wealth strategist, SEI Private Wealth Management, which is an umbrella name for various wealth advisory services provided through SEI Investments Management Corp., a registered investment advisor.