The Great Wealth Transfer: Risks, Challenges, and Opportunities for Asset Preservation

Drawing from the report, the article offers key insights into:

Wealth owners: ready to lose up to 50% of their fortune

Penguin Analytics shows that 23.7% of capital founders are prepared to give up to 25% of their wealth. They are ready to accept the loss in exchange for a guarantee that the rest will remain within their family's control. Additionally, 11.8% are willing to lose up to 50% for the same guarantee.

Only 11.9% of them recognize that, in the future, their children will need to complete KYC procedures for both themselves and their parents. This requirement is crucial because it ensures family assets and capital are documented from their origin, starting with the founding member.

Asset information storage: insecure and insufficient

In 81% of cases, capital owners personally handle the record-keeping and storage of asset information. They allocate their leftover time to this task.

However, the overwhelming majority opt for insecure methods to store and update their asset data. According to Penguin Analytics, 97.3% of them make these unreliable choices.

Only 17.5% of respondents know that capital founders lose up to one-sixth of their assets data each year. This data loss is often difficult or impossible to recover. The chances for family members to retrieve these records are even slimmer.

Just 7% of capital founders and 7.8% of their heirs get that, in a force majeure event, they usually have a 3-6 month window to claim assets in most countries. Without detailed asset data and attributes, family members can only access the most available assets–often called the 'low-hanging fruits'.

Are Losses Inevitable?

79.4% of capital founders doubt their family members' ability to understand information about assets and capital.

Furthermore, 48% of wealth owners think that their family won't be able to take possession of capital and assets, while 23.8% concede that family members might only partially succeed.

Only 5% of them grasp this: Experts view a net worth of $3M to $99M as wealth that will not last beyond one generation. This perspective comes from observing that in 69% of cases, a family's lifestyle declines after the wealth transfer.

Unforeseen Risks of Crypto Assets

Fully 87% of respondents are unaware that recovering crypto assets becomes impossible if the basic data related to the asset gets lost.

As a result, 23.7% of all crypto assets on the market lack identified owners. Merely 9.3% of survey participants know about this issue.

Crypto payment services report that only 7% of clients express concern about the risk of disrupted ownership continuity before finalizing a transaction.

Low Trust Level for Third Parties

More than 89% of wealth owners have doubts about trusted individuals and professionals. They question whether these individuals will handle tasks well when the time comes or if they will act in the family’s best interest. In fact, 63.3% are entirely uncertain about this.

In the surveyed target group, family trusts have a market penetration of 0.4%, while family offices reach 0.7%.

Only 7.8% of family members are aware that attorneys are 77.6% more likely to exhibit unscrupulous behavior towards successors than towards capital founders.

Data Gaps Lead to Major Losses

Barely 2% of capital founders know that, on average, up to 31% of family wealth is lost during the transfer. The primary reason for this is the lack of comprehensive asset data.

The most eagerly anticipated solution to wealth transfer challenges involves developing digital solutions. These aim to cut intermediaries and human-related risks by leveraging sophisticated algorithms.

Currently, 71.4% of wealth owners are open to relying on a third party, provided it operates without human involvement. However, no products or services at the moment offer this capability.

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Dive into the comprehensive findings of the Owner.One’s research. It offers deeper insights and conclusions.

Penguin Analytics is a chance to reflect. You can compare yourself against individuals from similar social circles. Afterward, you’ll be equipped to make well-informed decisions to protect both your assets and your family.