A windfall is set to fall into the laps of millennials over the course of the coming decades, a new report suggests, shifting the power dynamic in the economy away from boomers.
That’s according to property broker Knight Frank’s 2024 Wealth Report released this week, which reveals that over the next 20 years, $90 trillion in assets will betransferred between generations in the U.S. alone. By Knight Frank’s estimation, this shift will make affluent millennials “the richest generation in history.”
Previous reports show this figure at a lower $84 trillion, but nonetheless confirm a shake-up in the foundations of spending power across the globe.
Indeed, millennials are expected to befive times richer in 2030than they were approaching the beginning of thedecade, courtesy of the Great Wealth Transfer—but it hasn’t been an easy road for them thus far.
Millennials are among those who have been hardest hit by an increasingly inaccessible housing market—with Redfin finding that empty nesters own twice as many large homes as millennials with kids—as well as a jobs market irreversibly altered by a global pandemic.
Moreover, they’re dealing with crippling student debt, are facing down becoming a “sandwich generation” paying for both adult children and aging parents, and have long been told how lazy they are.
It’s perhaps no surprise, then, that a 2022 report fromAlliant Credit Unionfound that 53% of millennials are waiting on an inheritance of at least $350,000 from their parents—though their boomer parents say they intend to leave $250,000 or less.
“There is evidence that the youth of today blame the generations before them for the challenges that they and the planet face today,” said Mike Pickett, director of London-based Cazenove Capital, in the report.
Housing focus
The property broker added that housing will continue to be a focus of spending for the next generation, as those born between 1981 and 1996 may have struggled to get on the housing ladder thus far. Even at the highest end of the income ladder, growing a property portfolio is a key concern among those born between 1981 and 1996.
The study shows 23% of female ultra-high-net-worth individuals (UHNWI, valued at $30 million or above) are considering buying a home in 2024, with 21% of male UHNWI expecting to make a similar purchase this year. Wealthy Gen Zers feel the same, with 20% of those born from the mid-1990s to the early 2000s planning an acquisition.
But unlike those before them, younger buyers don’t see housing as a way to make money. “I don’t think younger generations see residential property as a route to wealth creation in the same way as boomers or Gen X,” said Mike Pickett, director of London-based Cazenove Capital.
He added: “In particular, the low interest rate environment and impressive growth in house prices of the past 15 years is unlikely to be repeated in the next 15. I also think there is some evidence that Gen Z may be happier to rent property or lease assets such as cars, and to adopt subscription-led lifestyles.”
Reaching the 1%
And if you’re hoping to reach the lofty heights of the richest 1% in the U.S. you need $700,000 more than last year.
The report found that breaking into the world’s top-one-percent club is getting more difficult every year. In the U.S. in 2023, individuals needed a net worth of $5.1 million to be considered in the richest echelons of society. By 2024 this figure rose to more than $5.8 million, an increase of approximately 14%.
But Americans determined to make the cut won’t need as much wealth as they would in other countries. Monaco, for example, requires a net worth of $12.88 million to “join the club,” an increase from $12.4 million last year.
However, making it into the 1% club doesn’t guarantee a spot in the VIP section: ultra-high net worth (UHNW). UHNW individuals need to have $30 million to their name in order to be considered in the pack—a figure well above the 1% for most nations.
Those in this illustrious group have also seen their net worth climb higher in the past year, with the AI boom helping the world’s richest add $150 billion to their portfolios.
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FAQs
Defined broadly as those born from 1981 to 1996, millennials, also known as Generation Y, could possibly see a sizeable windfall in the next 20 years, due to property and other assets amassed by their parents and grandparents. This could clock in at about $90 trillion (€83.1 trillion) in the US alone.
Do Millennials stand to become the richest generation in history after $90 trillion wealth transfer? ›
Millennials stand to become the richest generation in history, after $90 trillion wealth transfer. Millennials are set to inherit as much as $90 trillion in assets before 2044, a new report shows.
Who is the richest generation in history? ›
In the U.S. alone, Knight Frank said the shift would see $90 trillion of assets move between generations, “making affluent millennials the richest generation in history.”
What percentage of the US wealth is owned by Millennials? ›
In comparison, millennials own around 9.2 percent of total wealth in the U.S. In terms of population distribution, there is almost an equal share of millennials and baby boomers in the United States.
Why may millennials wait for a big inheritance? ›
Broome warns that late inheritance may confine many younger people to the rental market for decades, damaging the economy. Typically, owning a house with a mortgage costs less than privately renting, which enables people to have more liquid savings, consume more and invest more in their pension.
Will millennials stand to become the richest generation? ›
Millennials could stand to inherit trillions worth of property and property assets passed down by ancestors in the next 20 years. Millennials could potentially become the wealthiest generation ever, according to estate agent Knight Frank's 2024 Wealth Report.
Will millennials be the richest generation? ›
PITTSBURGH (KDKA) - Millennials could become the richest generation ever by the year 2044. That's according to The Wealth Report by global property consultant Knight Frank. The research says that generation is expected to inherit roughly $90 trillion worth of assets over the next 20 years.
How much wealth do millennials own? ›
According to Bloomberg, millennials only hold 4.6 percent of the wealth in America. The amount is $5.19 trillion. In juxtaposition, boomers hold 53.2 percent, or $59.96 trillion. They are 10 times wealthier than millennials, and twice as wealthy than Gen X.
Who is the youngest billionaire? ›
According to Forbes Billionaires List 2024, a 19-year-old Brazilian student Livia Voigt was named the youngest billionaire. She took this title from an Italian teen, Clemente Del Vecchio, who is just two months older than her.
What month are most billionaires born in? ›
If you want a month-wise breakup then, the highest number of billionaires, at 11, were born in October, followed by five each in August and June, four each in January, February, March, April and September, three in May, two in July and one in November. No billionaires were born in December.
While Millennials, as a generation, are wealthier than Baby Boomers were (as is Generation X, it should be pointed out), two other facts remain true: Millennials in the 90th percentile, or Top 10%, have 20% more wealth than similar Baby Boomers did at the age of 35.
What generation has the least money? ›
Millennials (born after 1980) are the generation with the least wealth. (The Federal Reserve does not have data on Generation Z yet.)
Why won't millennials inherit? ›
This is because the average millennial will have to use any inheritance they do receive to pay for expensive childcare, buy a home if they don't already own one or pay historically high rent and mortgage payments.
What was the best generation to be born? ›
The Greatest Generation commonly refers to those Americans who were born in the 1900s through the 1920s. The Greatest Generation members lived through the Great Depression and many of them fought in World War II. These individuals have often been described as driven, patriotic, and team players.
Do millennials carry more debt than other generations? ›
While Americans of all ages are grappling with higher balances, Gen Z and millennials are seeing the largest average increases in total debt and the steepest decline in credit scores, according to data provided to Fortune by personal finance company Credit Karma on tens of millions of member accounts.
How many generations until wealth is gone? ›
As the saying goes, 'from shirtsleeves to shirtsleeves in three generations. ' This means that wealth accumulated by one generation is often lost by the third generation.
Is wealth passed down from generation to generation? ›
Building lasting wealth involves creating a plan for how it will be transferred and passed down to the next generation. This is known as generational wealth. Figures from Gobankingrates show that 70% of wealthy families lose their wealth by the next generation, with 90% losing it the generation after that.
What money is passed down from generation to generation? ›
Generational wealth refers to financial assets passed from one generation of a family to another. Those assets can include cash, stocks, bonds, and other investments, as well as real estate and family businesses.
