White Paper details how the projected $3.5 trillion intergenerational wealth transfer will transform our economy  

Emma Sakellaris

Australia stands on the cusp of a massive intergenerational wealth transfer that will have enormous ramifications for the Australian economy, says investment bond specialist Foresters Financial in its latest White Paper, The Great Wealth Transfer.

Addressing the predicted $3.5 trillion wealth transfer by 2050, the White Paper focuses on the multifaceted challenges and opportunities created by this monumental wealth transfer for families, the economy, and society.

With analysis of key areas such as housing affordability, educational opportunities, and debt reduction, it offers invaluable insights into the socio-economic changes that will accompany this wealth transfer.

Foresters Financial CEO, Emma Sakellaris, emphasises the importance of understanding the implications of this wealth transfer. “Take women as an example. As behavioural finance studies indicate, women manage money differently to men, exhibiting tendencies such as saving more, displaying a property bias, prioritising ethics, and taking less risk, so their securing access to some of this wealth will be a significant game-changer.”

“It will also bring inevitable challenges, particularly with the rise of blended families and inheritance disputes. Even in traditional family structures, complexities emerge, underscoring the need for careful planning and proactive solutions.”

The White Paper sheds light on the concerning reality that many beneficiaries lack financial literacy. Sakellaris says: “The scale of this wealth transfer exposes the stark reality that there is an urgent need for accessible financial planning and improved education to ensure all Australians can navigate this transition effectively. Proactive estate planning is key to safeguarding assets and preserving familial harmony and protection of generational legacies.”

The White Paper attached considers the following in detail:

• challenges and opportunities in the context of the economy
• population growth and fertility rates
• changes in retirement trends and superannuation
• education bonds offer an option for older generations looking to leave an educational legacy for the next generation.