Wealth transfer: Handover starts long before the inheritance

WHEN wealth passes between generations, the relationship with the bank does not automatically follow. Capgemini’s World Wealth Report 2025 found that 81 per cent of inheritors plan to switch wealth management firms within one to two years of inheriting.

That puts assets built over decades at risk, but it is also an opportunity. UBS’ first Global Next Generation Report, published in May, found that around 72 per cent of Asia-Pacific heirs look first to wealth managers and family offices for succession support, against 42 per cent in North America and 19 per cent in Europe.

Heirs in Singapore clearly want professional help. Many will look for it elsewhere if the firm that served their parents does not meet their very different expectations.

A model built for one client

Much of Asia’s private wealth management was built around a single principal, often a founder or patriarch with a longstanding relationship manager. That produced deep loyalty, but left the relationship’s knowledge in one adviser’s head and a scattering of call notes.

When the principal dies, that knowledge rarely travels well. The heir inherits positions without the reasoning behind them, a fee structure from another era and a service rhythm designed for someone else.

UBS notes that in the Asia-Pacific, wealth transfer is closely tied to family milestones and the passing of older generations, so the handover often comes at a difficult moment with little preparation on either side.

Heirs also expect a different service. Used to running their lives through apps, increasingly augmented by artificial intelligence, they want to see what they own, what it costs and why it is held, without waiting for a review.

An inherited relationship buys a firm a meeting and a few months to show its value, with no guarantee the assets stay.

The change needed

Most private banks already engage the next generation through education, family governance workshops and events. That builds goodwill, but heirs still inherit a proposition, service model and cost structure designed for their parents.

Retaining their wealth means rethinking that model years before the transfer. Four shifts stand out.

The first is knowing the household beyond the account holder. Heirs, their roles in any family business, their own advisers and their priorities should be mapped while the principal is still the client.

UBS found that responsibility is often handed over before the wealth itself. Firms that record what they learn at that stage, and shape their service around it, will fit heirs when the assets move.

The second is institutional memory. The rationale for each holding, the family’s objectives and the history of past decisions should sit in records that a successor adviser and the heir can use. A portfolio that can explain itself is far easier to keep.

The third is the handover itself. Re-documentation, re-verification and account transfers can stretch over months, and every week of friction gives a competitor time with the heir.

Firms should measure the time from transfer to the first substantive advice discussion and shorten it. Many private banks and wealth managers Arta works with are now using AI to speed up onboarding and asset transfers.

The fourth is timing. The most valuable contact with an heir comes when something has changed – a liquidity event, a concentration risk drifting out of tolerance, a life event that alters what the money is for. Calendar-driven reviews miss most of these moments.

AI earns its place

This is where AI is most useful. It lets relationship managers give heirs immediate, accurate answers on what the portfolio holds, how it has performed, what it costs and why each position is there.

It can also surface changes across a household’s accounts, flag those relevant to the family’s goals and prompt the adviser when a conversation is due. The adviser arrives briefed, with more time for the judgement calls that heirs, particularly those inheriting a stake in a family business, will still want a person to make.

AI also lets firms anticipate what each client needs and offer personalised service at a scale human effort alone cannot reach.

The heir will arrive briefed too, having asked their own AI tools what the portfolio holds, what it costs and how it compares. Private banking leaders tell us they already see this with younger clients, and investors more broadly are following.

In a survey of Arta members in Singapore, 82 per cent were at least somewhat confident they could achieve the same returns using AI tools alone, without bankers, advisers or chat groups. An adviser who knows less about the portfolio than the client’s AI will struggle to earn the next meeting.

None of this replaces the relationship. It makes it less dependent on any one adviser. The next generation will judge a firm on their first six months of experience, whatever its history with their parents.

Firms that adapt their proposition, technology and service model well before assets change hands will be best placed to keep both the relationship and the assets. Wealth may change hands at a particular moment, but earning the next generation’s trust starts years earlier.

The writer is Singapore CEO and global head of partnerships, Arta Finance