The human side of succession: strategy, stewardship and staying at the table

Over the next two decades, somewhere between $3.5 trillion and $5.4 trillion will pass from the baby boomers to their children and grandchildren. In 2024 alone, more than $140 billion changed hands, and that annual figure is projected to rise as demographic momentum builds. The numbers are vast, frequently cited and increasingly familiar. But the implications for family succession are vital to the adviser, now and into the future.

This is not primarily an investment story; it is a succession one, for families and for advice as a profession.

Peter Leggett, chairman and chief investment officer at Arrow Private Wealth, frames the shift succinctly. “The biggest implication is this: we are no longer advising individuals, we are advising family systems.”

For decades, advice was constructed around the wealth creator. The emphasis was on accumulation, tax efficiency and portfolio performance. Today, that model feels incomplete. Advisers are being asked to preserve capital for founders, provide security for spouses and partners and prepare children and grandchildren to inherit responsibly. The mandate is broader, and more complex.

The evolution of families

This requires a different kind of conversation. Inter-generational structuring, governance and family intent now sit alongside portfolio construction. As Leggett points out, the discussion is increasingly about “clarity around purpose, rather than just performance.”

Behind the multi-trillion-dollar estimates lie deeply personal concerns. Clients want to know whether their capital will sustain a long retirement, potentially into their nineties. They worry about the financial resilience of a surviving spouse. They question whether their children will be capable stewards of inherited wealth. Many ask whether the transfer of funds in succession will unite or divide the family.

These are not asset allocation questions. They go to values, responsibility and legacy.

The growth of the living legacy

Rather than waiting for their wills to be activated after their death, individuals are increasingly transferring capital during their lifetimes. This may involve funding a grandchild’s education, backing a new business venture or philanthropy. Clients increasingly want to witness the impact of their wealth and shape how it is used.

In this context, money becomes something to steward across generations, rather than simply distribute at death. Succession becomes a gradual process, not a one-off event.

Impact on advice firms

There is also a hard commercial reality for advice firms. International experience suggests that when the primary wealth holder dies, assets often leave the adviser within a year. When both parents pass away, attrition rates can climb further. Often the explanation is straightforward. The adviser has never established a meaningful relationship with the spouse or the next generation.

Engaging beneficiaries early is a crucial thread in succession planning for advisers. It is not as simple as delegating younger clients to a junior adviser. Expectations have shifted. Younger beneficiaries tend to demand transparency, digital access and alignment with their own values. They are less impressed by credentials alone and more focused on relevance and authenticity.

Broader competencies

This shift places new demands on advice businesses. Technical expertise remains foundational, but emotional intelligence is now equally important. Advisers are increasingly expected to facilitate family discussions, manage competing expectations and position wealth as a responsibility rather than an entitlement.

The sequencing of advice is also critical. As discussed in The Inside Network’s recent INPractice Online Masterclass, the order matters: strategy first, structures second, solutions last. Effective succession planning begins with clarifying intent and articulating shared values before legal structures are drafted. Products should support strategy, not define it.

Within that framework, certain tools are receiving renewed attention. Nick Heuzenroeder, head of Line 1 Risk and Operations Support and responsible manager at KeyInvest, notes that investment bonds are re-emerging as a practical option in some intergenerational scenarios.

Investment bonds can allow changes to ownership and beneficiaries, while enabling investment adjustments without triggering capital gains tax events. They may also facilitate staged distributions which mitigates some of the challenges faced when receiving a lump sum. They also help address unequal outcomes (or those where some beneficiaries perceive unfairness) in family businesses or with respect to primary production assets. This is particularly relevant where there are vulnerable beneficiaries that may require different protections. Estate planning features can allow the original investor to guide how and when funds are accessed.

But products, however useful, are only part of the equation.

As wealth transitions accelerate, advisers are increasingly acting as co-ordinators for the broader professional ecosystem. Even in the absence of a formal family office, there is often a need to bring together legal, tax and specialist expertise within a coherent strategic framework. Philanthropy, too, is becoming a more frequent component of these discussions, reflecting a desire among many families to embed purpose into capital.

Risks and opportunities

The open question is which advice firms will adapt in time. Practices that continue to define their value on solely investment performance risk being marginalised at the point of transfer. Those that embrace stewardship, and see themselves as advisers to families rather than individuals, have the opportunity to build relationships that extend well beyond a single generation.

In a transfer measured in trillions, product selection and performance metrics will matter, but they are unlikely to be decisive. Trust, clarity of purpose and a willingness to engage in the most difficult conversations may ultimately determine which advisers remain at the family table when the wealth changes hands.

Laurence Parker-Brown

Laurence Parker-Brown is head of content at The Inside Network and managing editor of The Inside Adviser and Investor Strategy News.