A new report by Capgemini, the World Wealth Report 2025, indicates that a significant portion of Australians is poised to inherit substantial wealth in the coming years. This transformation is expected to create a generation of instant millionaires who will approach their newfound riches with a different mindset than previous generations.
Currently, Australia boasts approximately 334,800 high net worth individuals (HNWIs), whose combined wealth exceeds $1 trillion (USD). This includes around 30,240 “mid-tier millionaires,” with assets between $3 million and $5 million, and 2,450 individuals with fortunes surpassing $30 million. Over the next two decades, a substantial transfer of wealth is anticipated, with projections suggesting that by 2040, 80% of HNWIs will have received an inheritance.
This wealth transition aligns with a global phenomenon, as an estimated $83.5 trillion is set to circulate from older generations to younger investors, including Gen X, millennials, and Gen Z. Unlike their predecessors, these next-generation investors are more inclined to embrace riskier investment strategies, demonstrating a marked preference for assets like cryptocurrencies and private equity.
The report highlights a significant shift in investment attitudes, with younger inheritors showing a desire for greater risk-taking in pursuit of wealth expansion. According to Kartik Ramakrishnan, CEO of Capgemini’s Financial Services Strategic Business Unit, this “great wealth transfer” will redefine the financial advisory landscape. The report also warns that as global wealth grows, a staggering 81% of those who inherit wealth intend to switch financial firms within the first couple of years of inheriting assets. This trend poses a considerable challenge for wealth management firms, as they risk losing dissatisfied clients during this critical transitional phase.
In summary, Australia is on the cusp of a transformative wealth transfer that will elevate many to millionaire status, fundamentally altering investment behaviours and expectations among the younger generation of wealth holders.