The Great Wealth Transfer: Will Millennials Really Be the Richest Generation in History?

The ‘avo on toast’ generation may be about to become the wealthiest generation the world has ever seen. Or so the headlines say.

Millennials have copped it for years. Mocked as the generation too busy ordering flat whites and smashed avocado to save for a deposit, they have been cast as the poster children of financial irresponsibility. The stereotype is persistent, occasionally funny, and largely unfair.

Behind the memes, something far more consequential is unfolding. A global transfer of wealth from baby boomers and the silent generation to their children and grandchildren is already underway. The numbers are large: up to $1.6 trillion in New Zealand alone, and US$124 trillion globally.

But big aggregate numbers do not mean big individual windfalls. After aged care costs, potential tax changes, legal disputes, siblings, and the sheer unpredictability of the next quarter-century, the inheritance reaching any individual millennial is likely to be more modest, later in life, and more complicated than the media coverage suggests. This article unpacks what the great wealth transfer actually means for New Zealanders, and what you can do about it regardless of whether you inherit anything.

The Global Picture

Boston-based research firm Cerulli Associates estimates nearly US$124 trillion in assets will change hands globally by 2048. Capgemini’s World Wealth Report 2025 puts the figure for high-net-worth transfers specifically at US$83.5 trillion.

In the United States, millennials’ collective net worth quadrupled between late 2019 and late 2024, from US$3.9 trillion to nearly US$16 trillion. Much of this was driven by early inheritances, rising asset prices, and the fact millennials are now entering their peak earning years.

Warren Buffett put it characteristically well: “Someone’s sitting in the shade today because someone planted a tree a long time ago.” The great wealth transfer is, in many respects, boomer shade arriving just as millennials need it most.

What the Wealth Transfer Looks Like in New Zealand

New Zealand is no sideshow in this global shift. According to economic consultancy BERL, those aged over 55 currently hold roughly 60 percent of New Zealand’s $2.4 trillion in total individual net wealth. The value due to change hands over the next two decades sits between $1.1 trillion (BERL) and $1.6 trillion (JBWere’s 2025 Bequest Report).

To put the upper estimate in context, it exceeds the combined value of every company listed on the NZX.

But here is the detail most headlines gloss over: nearly half of all New Zealand household wealth is tied up in residential property. This is not a pile of cash waiting to be distributed. It is bricks, mortar, and land. Turning a family home into a distributable inheritance requires selling it, and selling carries its own emotional, logistical, and financial costs.

Stats NZ’s 2024 Household Economic Survey offers the most recent snapshot. Median household net worth reached $529,000, up 33 percent from 2021, driven largely by property values. The wealthiest 10 percent of households hold 49 percent of all net worth.

For the first time, Stats NZ measured inheritances directly. A third of all households reported receiving one, and their median net worth was $984,000. Among households who had not received an inheritance, the gap is stark. The transfer is not creating new wealth so much as concentrating existing wealth among those who already hold assets.

And the per-person numbers are considerably less dramatic than the headlines. If $1.1 trillion is transferred across, say, two million recipients over 20 years (a rough approximation based on population and family structures), the average sits closer to $550,000 per recipient. Divide by siblings, subtract aged care costs and any future tax changes, and many individual inheritances shrink well below the family home’s rateable value. This means counting on a windfall as a retirement plan is risky.

The ethnic dimension deserves attention. After adjusting for age, the median European individual holds $222,000 in net worth. For Māori, it is $52,000. For Pacific peoples, $26,000. These are fundamentally different financial realities, and they mean the great wealth transfer will overwhelmingly benefit families who already hold assets.

The central tension is this: the total transfer is historic, but the typical individual experience will be far more nuanced. Here are five reasons the windfall may be smaller than the headlines promise.

Five Reasons the Windfall May Be Smaller Than You Think

1. The Tax-Free Window May Not Stay Open

New Zealand’s unusually light tax treatment of wealth is under growing fiscal pressure.

New Zealand currently has no inheritance tax, no gift duty, and no comprehensive capital gains tax. Among OECD countries, this is unusual. Treasury’s Long-term Fiscal Statement projects net core Crown debt reaching 200 percent of GDP by 2065 without significant policy changes. The IMF’s 2025 review explicitly recommended New Zealand consider a comprehensive capital gains tax and a land value tax.

Whether or not any specific tax eventuates, the fiscal trajectory is clear. If a capital gains tax, inheritance tax, or wealth tax lands before peak transfer years in the 2040s, the after-tax value of transfers shrinks materially. As one economist observed, the great wealth transfer could just as easily become a transfer to the tax collector.

2. Aged Care Eats Into the Estate

Later-life health costs often convert housing wealth into care fees, not inheritances.

In New Zealand, if you enter an aged care facility after age 65, you generally pay your own way until your total assets fall below the threshold for a taxpayer-funded residential care subsidy. For a single person, the current threshold is $291,825. In practice, this often means the family home needs to be sold to fund care.

Consider a widowed parent in Christchurch whose home is worth $700,000 and who requires dementia care costing $1,500 per week. The house gets sold, the care gets funded, and by the time the subsidy kicks in, there may be very little left for the next generation. Millennials counting on a property inheritance from a parent who requires extended care may find the maths work out very differently.

3. Inheritances Get Squandered

Seventy percent of wealthy families lose their fortune by the second generation.

A 20-year study by the Williams Group of 3,200 families found 70 percent of wealthy families lose their wealth by the second generation, and 90 percent by the third. The two primary causes were a breakdown in family communication (60 percent of cases) and unprepared heirs. Lottery winners face a similar pattern.

The parallel is clear: unearned money, without financial literacy or a clear plan, tends to evaporate. If you inherit $400,000 and immediately book a European holiday, buy a new SUV, and renovate the kitchen, you may find you have burned through a large share of what your parents spent a lifetime accumulating.

“If you give your kids too much, you risk their motivation. If you give them too little, you limit their opportunity. The sweet spot requires real thought, and the best time to find it is while everyone is still around the dinner table.” — Joseph Darby, CEO, Become Wealth

4. Siblings Divide the Pie

An estate split among two or three adult children is obviously smaller than the headline figure.

The New Zealand average family size is about 2.7 people. Blended families, second marriages, and estranged relationships add further complexity. In our experience at Become Wealth, it is not uncommon for family tensions to surface only after a death, often inflamed by spouses. This is exactly the worst time for financial decision-making.

5. Legal Disputes Can Drain the Lot

Will disputes in New Zealand are surprisingly common, emotionally exhausting, and expensive.

New Zealand’s Family Protection Act 1955 imposes a moral duty on parents to provide adequate support for their children. If a parent excludes a child from their will, the child can lodge a claim. The New Zealand Law Commission has recommended reforms, but as things stand, contested estates remain common. In most cases we have seen, it is only the lawyers who finish ahead.

A conversation with your parents while they are alive and well is worth more than any legal argument after the fact.

The Generational Headwinds Are Real

None of this happens in a vacuum. Millennials and Gen Z have already lived through the Global Financial Crisis, a pandemic, a spike in New Zealand’s cost of living, and a period of sharply rising interest rates. Homeownership rates for younger New Zealanders have fallen steadily: in 1991, 61 percent of those aged 25 to 29 lived in an owner-occupied home, compared with 44 percent by 2018.

For context, older generations have their own scars. New Zealand’s mortgage rates in the 1980s briefly exceeded 20 percent and averaged well over 10 percent for the full decade. The point is not to hold a generational suffering contest, but to acknowledge every cohort faces its own financial obstacles. Expecting an inheritance to solve those obstacles is a fragile plan.

It is also worth noting when most people actually receive an inheritance. With life expectancy in New Zealand now above 80, and many baby boomers likely to live well into their late 80s or 90s, the median age at which their children inherit is likely to be in the late 50s or 60s. By then, most of the major financial pressures of life (buying a home, raising children, funding education) have already passed. The money arrives, but not when it would have made the most difference.

Two Very Different Inheritance Stories

Consider Sarah, a 38-year-old Auckland professional. Her parents own a house in a good suburb valued at $1.4 million, with no mortgage, plus about $300,000 in savings and investments. On paper, her eventual inheritance looks substantial. But Sarah has two siblings, her father has early-stage cognitive decline, and her mother has mentioned the family home may need to be sold to fund future care. After dividing the remaining estate three ways, Sarah might realistically see $200,000 to $350,000, arriving when she is in her early 60s.

Now consider Tom, a 42-year-old Wellington tradie whose parents rented their entire lives and have modest KiwiSaver balances. Tom will inherit very little. His financial future depends entirely on what he builds himself: his income, his savings rate, and how he chooses to invest. In many ways, Tom’s path is clearer, because he has never been tempted to wait for someone else’s money.

Both stories are common. The difference is starting position, and it is why the great wealth transfer may be as much an inequality story as it is a prosperity one.

What to Do If You Are Expecting (or Receive) an Inheritance

The single most important thing you can do is not rely on money you have not yet received. The wealthiest New Zealanders we work with share a common trait: they built their financial position through deliberate decisions about their own careers, savings, and investments. An inheritance, if it arrives, is a financial bonus, not a foundation.

If you do receive a lump sum:

• Pause before you spend. The impulse to book a holiday or upgrade the car is natural. So is the impulse to make snap investment decisions. Taking three to six months to sit with the money is not laziness. It is good sense.
• Clear expensive debt first. Mortgages, credit cards, and any consumer debt should be evaluated in order of interest cost. Paying off a credit card charging 20 percent is the best guaranteed return you will ever find.
• Invest with purpose. Leaving a large sum in a savings account is comfortable but costly after inflation. A well-diversified investment portfolio aligned with your goals, risk tolerance, and time horizon is the most reliable path to turning an inheritance into lasting generational wealth of your own.
• Get professional advice. An inheritance often comes with tax, legal, and emotional complexity. A good financial adviser will help you separate the financial decisions from the emotional ones, and they will tell you things you do not want to hear. Both are valuable.

Questions Worth Asking Before Counting on an Inheritance

If you are in the position of expecting a future inheritance, there are a few questions worth sitting with honestly. First, how much of your parents’ wealth is in property versus liquid assets? If the answer is mostly property, the timing and value of any inheritance depends on when and whether it is sold, and at what price. Second, has your family discussed estate planning openly? The Williams Group research is unambiguous: the single biggest predictor of whether wealth survives a generational transfer is whether the family talked about it beforehand. Third, does New Zealand’s current tax-free treatment of inheritances seem likely to last another 20 years, given the fiscal pressures? If you are uncertain, it may be wise to build a financial plan as though the inheritance is smaller (or later, or more taxed) than you currently expect.

New Zealand currently has no inheritance tax, no gift duty, and no comprehensive capital gains tax. This is unusual among OECD countries, and the direction of fiscal pressure suggests caution rather than complacency.

The Bottom Line: Will Millennials Be the Richest Generation in History?

The great wealth transfer is real, and the sums involved are genuinely historic. In New Zealand alone, more than a trillion dollars will change hands over the coming decades. But the breathless coverage deserves scrutiny. After aged care costs, potential tax changes, legal disputes, and the simple arithmetic of dividing estates among siblings, the windfall reaching any individual is likely to be more modest than the headlines suggest.

The best approach is the one the financially successful have always taken: build your own position, make good decisions with what you control, and treat any inheritance as a welcome tailwind rather than the engine. If you do receive a meaningful sum, treat it with the seriousness it deserves. Your parents probably spent a lifetime accumulating it.

Whether you are building wealth from scratch or preparing to make the most of an inheritance, the principles are the same: a clear plan, good advice, and the discipline to follow through. If you would like to talk through what this looks like for your situation, book a complimentary consultation with the Become Wealth team. Your version of financial freedom starts with the decisions you make today.