Why most Australian family fortunes won’t survive the coming intergenerational wealth handover
Wealth transfer is accelerating in Australia. But governance is lagging.
Most Australian family fortunes do not survive the handover to the next generation. On the most widely cited research, from the Williams Group, 70 per cent of families lose their inherited wealth by the second generation and 90 per cent by the third. Only one in twenty pass on more than they received.
The failures are rarely technical. The same research attributes around 60 per cent to a breakdown of trust and communication within the family and a further 25 per cent to unprepared heirs, with tax and markets a small residual.
Lipman Burgon, a partner-led wealth governance firm, argues these are governance failures: who decides, how, and how the next generation is prepared. More advice does not close the gap. Better-governed decisions do. And the stakes are rising. The Productivity Commission estimates around $3.5 trillion in assets will change hands in Australia by 2050, with inherited assets, roughly $120 billion a year now, projected to quadruple to almost $500 billion a year within 25 years.
According to Paul Burgon, Chief Executive and Chief Investment Officer of Lipman Burgon, this is changing what families need from an adviser: from investment management alone to the governance of decisions across the whole of a family’s affairs, as families hold more across more structures, jurisdictions and generations at once. The firm describes its work in a single line: better decisions through governance.
“Most families with real complexity don’t lack advisers. They lack someone accountable for how the advice fits together,” Burgon says.
That accountability is the heart of the firm’s model. One partner holds the full context of a family’s affairs and convenes the specialists and advisers around them, so the parts operate as a whole. Critically, the model does not displace the accountant or the lawyer. It coordinates them, under a single plan, with one partner answerable for how the pieces fit.
“The biggest risk for many families isn’t market volatility,” Burgon says. “It is fragmented decision-making.”
The point is not to promise better returns, rather better decisions: the quality, coherence and accountability of the choices made across investments, structures and family over time. Lipman Burgon structures every client relationship through the same methodology, Architecture, Governance, Stewardship, whichever service the family enters through.
“The real test is continuity. Most of the families we have worked with for more than 10 years now have the next generation actively involved, well before any handover. That is what carries wealth across generations,” Burgon says.
The urgency is generational. Joanna Sun, Head of Family Office Design at Lipman Burgon, says the transfer now underway will test families that have not done the governance work.
“Wealth transfer is accelerating in Australia. But governance is lagging,” Sun says. “The families that have done the work will be the ones whose wealth survives the handover.”
Lipman Burgon works across three connected service lines: Wealth, Private Office and For Purpose. Wealth covers investment-led advice and stewardship of financial capital. Private Office provides comprehensive stewardship for families with complex affairs, coordinating the whole advisory ecosystem. For Purpose brings investment governance to foundations, charities and other mission-led organisations. One organising logic runs through all three, under the firm’s promise: Wealth and Legacy in Motion.
Behind the promise sits a broader view of what wealth is for. In the firm’s framework, financial capital is the engine, not the destination. It exists to serve four other forms: the human capital of family members, the family’s intellectual capital, its social capital, and its legacy capital, the enduring contribution and purpose carried across generations. Wealth governance, on this view, is the discipline that keeps all five moving in the direction a family intends.
