A new wave of billionaires is invading the world’s richest 1%, and they didn’t make their wealth through humble beginnings.
Inheritance Surpasses Wealth Creation
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A shift in global wealth has occurred for the first time in the nine years that UBS has monitored billionaires.
Inheritance Driving Billionaires
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In a report from UBS, the new members of the billionaire community managed to acquire more assets through inheritance than entrepreneurship.
Passing on the Wealth
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“After the surge in entrepreneurial activity witnessed over the past few decades, many business founders are now ageing and passing their wealth to the next generation,” according to a survey.
Expanding on Wealth
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68% of billionaires in the survey said “that they aim to continue and grow what their forebears achieved.”
Inheritance vs. Entrepreneurship
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In the past year, the “84 new self-made” billionaires across the world accumulated $141 billion from entrepreneurship.
Heirs Overtake Self-Made Billionaires Total
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At the same time, the 53 heirs inherited a larger sum of $151 billion.
A Common Trend
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UBS’s Benjamin Cavalli stated, “This is a theme we expect to see more of over the next 20 years, as more than 1,000 billionaires pass an estimated $5.2tn to their children.”
A Worldwide Phenomenon
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The “growing significance of these families can be seen across all major geographical regions”, according to the report.
Ambitions to Succeed
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Despite the unimaginable wealth inherited, “they also have ideas and ambitions of their own,” according to the report.
Building the Family Legacy
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“They appear conscious of the fact that they may need to reshape and reposition their wealth if they want to continue the family legacy,” it said.
Rise in Billionaires
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The billionaire community worldwide saw the addition of 200 new members, an increase of 7%, in the 12 months leading up to April 2023.
Pandemic’s Rise in Wealth Gap
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Back in 2020, 100 million people sank into extreme poverty across the globe, while billionaire’s wealth grew during the pandemic.
Disrupting a Positive Trend
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A report from the BBC showed that before this period, the world’s extreme poverty cases had been shrinking consistently for 25 years.
Joining the Poverty Line
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“While the wealth of billionaires rose by more than $3.2tn, 100 million more people joined the ranks of extreme poverty,” the report said.
A Good Quarter of a Century for the Rich
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In the last 25 years, the world’s richest 52 individuals saw their wealth rise by 9.2% each year.
Momentum Grows Across Generations
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We’re currently in a period of what is described as the ‘great wealth transfer’ as baby boomers and Generation X share their wealth with millennials and younger individuals.
Huge Numbers of Generational Wealth
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Cerulli Associates estimated a staggering $73 trillion will be inherited in the U.S. alone by 2045, “The great wealth transfer is really gaining momentum now,” another UBS member noted.
New Generation
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The world’s wealth gap is increasing each year, and now billionaires are passing their wealth down to rich and hungry sons and daughters; it’s clear it won’t get better any time soon.
The post Inherited Billionaire Status on Rise, Diminishing Social Mobility first appeared on Swift Feed.
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The content of this article is for informational purposes only and does not constitute or replace professional financial advice.