The collective inheritance of the Baby Boomers to their children and their children’s children is set to be the most significant in history. Headlines forecast an eye-watering $100 trillion globally set to move from Baby Boomers to their heirs, a windfall that is predicted to reshape global capital markets and redefine investment strategies. However, the ‘Great Wealth Transfer’ is proving to be slower and more complex than anticipated.
In 2020, the average age at which individuals in several EU economies received inheritances was 54, up from 42 in 1984 according to Banque de Luxembourg. This means many heirs receive assets not during the entrepreneurial or risk-taking years of their thirties or forties, but well into middle age, often after critical financial decisions have already been made.
Compounding this dynamic is a persistent gap in financial literacy. A 2023 Eurobarometer survey found that only 18% of EU citizens demonstrate a high level of financial literacy, with significant disparities among member states. For the next generation of beneficiaries, navigating complex asset classes such as private equity, private credit, or infrastructure remains a significant barrier both educationally and behaviourally.
Unlike in the United States, where the “giving while living” movement has gained cultural traction, wealth transfer in Europe remains cautious and fragmented. Cross-border legal structures, inheritance taxes, and cultural cautiousness all slow the pace at which capital reaches the next generation. This equally applies to the very richest in society. Many high-net-worth families are channelling wealth through trusts, foundations, or family offices, vehicles that often prioritise stability and control over accessibility.
For private markets, these trends suggest that the much-anticipated influx of next-generation capital may be less predictable than once thought. Fund managers must adapt to a reality where liquidity is governed not just by market cycles, but by tax regimes, familial governance structures, and regulatory inertia.
Can European private markets still capitalise on the coming wealth transfer given these constraints?
The gatekeepers of generational wealth
If capital is being passed down, why isn’t it flowing into private markets?
Across Europe, intergenerational wealth is often transferred through intermediary vehicles—family offices, trusts, or foundations—that prioritise preservation and governance over immediacy. These structures retain control of capital through multi-generational oversight, with formal processes governing access and distribution.
Family offices have emerged as powerful gatekeepers. According to PWC’s Global Family Office Deals Study, over 75% of family offices globally have been established since 1993, with nearly half launched after 2006—underscoring how many of these structures are still maturing and reflecting a growing preference for professionalised wealth structures that resemble institutional investors in both strategy and governance.
Yet succession planning remains inconsistent. Fewer than half of family offices have documented transition strategies in place. Even when the intent is to transfer wealth, the execution is often slow, structured, and cautious. Investment decisions are guided by long-term frameworks that favour control, continuity, and alignment with family values over liquidity or yield.
Legal and tax structures reinforce this conservatism. Although civil inheritance law has been harmonised across the EU, tax treatment remains highly fragmented. Marginal inheritance tax rates range from zero (in Austria and Sweden) to as high as 80% (in parts of Belgium), with limited bilateral treaties to prevent double or triple taxation. For cross-border families, such asymmetry often delays or fragments the transfer of assets.
Meanwhile, inheritors themselves are often unprepared. Among the next generation, the ability to understand, let alone deploy, private market capital remains uneven, particularly for illiquid asset classes that demand long-term thinking and a high degree of trust in fund governance.
Together, these dynamics make one thing clear: wealth transfer is not translating into immediate investment potential. For asset managers and private market sponsors, the next chapter will not be written by heirs alone but by the structures and stewards that surround them.
Future-proofing private markets
The Great Wealth Transfer may not deliver a flood of liquidity, but it does present a moment of strategic recalibration. For European private markets, the challenge is not the absence of capital, but access: wealth is embedded in family offices, trusts, and cross-border vehicles built for continuity, not spontaneity.
To remain relevant, European asset managers must go beyond product design and rethink how they engage with investors across generations. This begins with education. Many next-generation beneficiaries remain unfamiliar with the complexity, duration, and risk profile of private assets, particularly when compared with the immediacy of public markets.
New regulatory frameworks like ELTIF 2.0 offer tools to improve access through semi-liquid structures, but capital won’t flow on structure alone. Asset managers must tailor onboarding, reporting, and governance interfaces to fit within existing dynamics.
Personalisation—through co-investment platforms, values-aligned mandates, or hybrid vehicles—can help bridge generational preferences while respecting legacy constraints.
Trust will not be inherited. It must be earned. And the managers who earn it will be those who meet heirs not just with product, but with purpose. In an asset class where lock-in periods are long and due diligence is deep, conviction matters. Success will depend on intentional, long-term positioning: aligning with the structures that manage wealth today, while equipping those who will deploy it tomorrow.
Written by René Paulussen, Alternatives Leader at PwC Luxembourg
