The world's aging billionaires are expected to pass $2.4 trillion to their kids and charity in the coming decades, according to a new report.
The world's 1,542 billionaires are now worth $6 trillion, according to a report from UBS and PwC. More than a third of those billionaires over age 70, setting up what many expect to be the largest wealth transfer of big fortunes in history.
The report said the world's billionaires will hand down $2.4 trillion over the next 20 years. UBS' Judy Spalthoff said it's unclear how much of the $2.4 trillion will go to wealthy kids and families, and how much will go to charity. But she said about a third or more could end up going to charitable causes.
"We believe this is the largest wealth transfer from billionaires to the rising generations and philanthropic causes that they care most passionately about," said Spalthoff, head of family and philanthropy advisory services. "Whether it be private museums or there are great philanthropic causes — we are seeing a great wealth transfer to these causes that people are really passionate about."
The giant cascade of billionaire wealth, however, will also be complicated. The report notes that many of today's rich families have members spread around the world, leading to complex trust-planning issues for different tax and legal jurisdictions.
"The result is a Rubik's cube of geographies, cultures and generations that needs to be solved," the report said. "Family members have different tax residencies and nationalities, making succession planning more complex and sophisticated. How does the French family with houses in Singapore and London plan? What should a Saudi family do when it has daughters educated in the US who want to take over the business?"
Nice problems to have, to be sure.