Transfer of wealth from aging baby boomers to younger generations is reshaping the wealth management industry in ways that demand greater efficiency and adaptation by incumbent firms, according to a new report from Temenos and Forbes Insights.
The study revealed that generations X and Y move ‘effortlessly across both the analog world of face-to-face meetings and the virtual world of digital platforms that enable the fast and accurate service they expect’.
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The study revealed that 34% of HNW clients now require digital communication from their wealth manager, while 62% of HNW clients prefer digitisation of wealth management services but still want to meet often with an advisor.
Seventeen percent of the respondents opined that technology is necessary, while 48% rated cyber risk and hacking as top impediments of technology use.
The study report says that firms should not alienate older clients who are still the bedrock of the business, though they should improve technology to meet demands of younger clients.
More than 40% of wealth managers held the view that a mix of digital and human expertise is the ideal way of interacting with clients, the report added.
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By GlobalDataTemenos product director of wealth management Pierre Bouquieaux said: "With this generational transfer of wealth underway, firms must be alert to the challenges presented by a more complex set of customer needs – as well as growing cyber risks.
"Yet, this is a fantastic opportunity. These findings highlight that increasingly intelligent technology will help wealth managers redefine processes, find new efficiencies and build better relationships with their clients."
