Denis Orrock
Praemium’s latest research in conjunction with CoreData reveals that the “Bank of Mum and Dad” continues to play a pivotal role in the generational wealth of Australians, with high-net-worth families providing significant support to the next generation, often well before inheritance.
Key statistics from the research:
- 96% of high-net-worth investors have already provided financial support to loved ones, most commonly for education (58%), ongoing financial support (56%), direct cash gifts (49%), covering major life events (48%) and gifted or transferred property (34%).
- Nearly a third who have provided financial support to loved ones have given between $250,000-$500,000 to family members, with 26% contributing between $500,000 and $1 million.
- 96% intend to pass on assets, of these 85% plan to transfer at least some wealth while still alive.
- 89% report a strong understanding of legal wills, 80% of trusts, and 81% of self-managed super funds as vehicles for wealth transfer.
- Only 41% of those intending to pass on assets have formalised and documented their plans, and just 63% have made any kind of plan with their adviser to reduce tax on wealth transfers.
While the research shows a high level of awareness and understanding of wealth transfer structures, it also highlights that many families are still in the process of formalising their plans. Challenges such as managing family dynamics, understanding tax implications, and ensuring responsible stewardship remain front of mind for many.
These findings present an opportunity for advisers to support clients in planning and documenting their giving strategies, and to encourage early conversations with beneficiaries. By helping clients navigate the complexities of gifting – whether through trusts, superannuation, or direct support – advisers can add value and help ensure that generosity aligns with both family values and financial goals.
Denis Orrock, Chief Strategy Officer at Praemium, comments: “We’re seeing families take a much more active role in supporting the next generation, with significant value being transferred well before inheritance. Advisers can play a key role in helping clients formalise their plans, manage tax, and involve beneficiaries in the conversation early. They can also help address some of the challenges investors face with transferring wealth now and in the future.”
“With most high-net-worth investors already supporting loved ones in substantial ways, and a high level of awareness of the available structures, the research underscores the need for expert, personalised advice. Praemium is committed to helping advisers and their clients manage these decisions with clarity, confidence, and care.