A recent report by global property consultancy Knight Frank suggests that the affluent segment of Generation Z is confident in its ability to build wealth, mirroring the sentiments of high-net-worth individuals globally.
According to the report, 65% of high-net-worth individuals anticipate an increase in their wealth in 2024. High-net-worth individuals are defined as those with a net worth exceeding $1 million or an annual income surpassing $200,000. The survey, known as Knight Frank’s Next Gen Survey, involved 600 high-net-worth individuals.
Among different age groups, Gen Z emerges as particularly optimistic, with 75% of the youngest cohort in the workforce expecting their wealth to grow. Notably, 43% of this group anticipate “significant growth.”
The report notes a distinct pattern regarding age: younger affluent cohorts express greater confidence in the economic outlook compared to older groups.
A gender breakdown reveals interesting nuances. While 81% of high-net-worth Gen Z women expect their wealth to increase, only 69% of high-net-worth Gen Z men share the same sentiment. This deviation from the overall trend, where men typically anticipate greater financial growth, suggests a potential continuation of the trend of increasing female ultra-high-net-worth earners, defined as individuals with a net worth exceeding $30 million.
The report forecasts a significant wealth transfer of $90 trillion in assets over the next two decades, with millennials poised to benefit the most from this transfer. Rich millennials could potentially become the wealthiest generation in history, according to the report’s projections.
However, the outlook for the broader Gen Z and millennial cohorts appears less optimistic. Challenges such as inflation, healthcare expenses, rising housing and transportation costs, and mounting debt contribute to their concerns. Confidence in making significant purchases, such as buying a home, remains low among these demographics.
Despite these challenges, previous surveys indicate a growth in the net worth of younger generations, particularly during the early stages of the pandemic. An analysis by the Liberty Street Economics blog at the Federal Reserve Bank of New York revealed an 80% increase in wealth among Americans under 40, attributed to various factors including stimulus payments, savings from lockdown measures, and temporary relief from student loan repayments.
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