By Kartik Ramakrishnan

As Warren Buffett prepares to step down as CEO of Berkshire Hathaway, the wealth management industry finds itself at a generational crossroads. For decades, baby boomers followed the Oracle of Omaha's long-term, value-driven philosophy -- one that yielded legendary returns far exceeding those of the S&P 500.

But with the multitrillion-dollar transfer of wealth from baby boomers to their heirs under way, the industry faces a pressing quandary: To what extent are Gen Z investors -- raised on crypto, Coachella, influencer culture, and instant access to nearly everything -- shifting away from fundamentals-based strategies? And, as a result, how can wealth management firms adapt?

To find answers, Capgemini's 2025 World Wealth Report interviewed over 5,000 next-gen, high-net-worth investors -- including nearly 600 Gen Zs with $1 million or more in liquid assets -- to better understand their investment behavior and their relationship with financial planners.

What we saw was a generation with a radically different outlook on wealth. According to our research, Gen Z high-net-worth individuals now account for 11% of global wealth, matching the purchasing power of baby boomers. With their peak earning years ahead, these investors' preferences carry significant weight.

When it comes to wealth, this next-gen cohort is pursuing growth, not preservation. Gen Z high-net-worth individuals favor a 50/30/20 (equities, fixed income, alternatives) portfolio model as opposed to the "safe" 60/40 portfolio favored by their boomers. Alternative investments comprised 17% of high-net-worth Gen Z portfolios at the beginning of this year with private equity and cryptocurrencies leading the way.

Gen Zers also have a decidedly international outlook, with many holding multiple passports. Emerging International hubs like Singapore and Dubai are growing in popularity, offering not just tax benefits but also geopolitical security and economic diversification.

This cohort also prizes luxury goods and services, with an emphasis on experiences and travel. For them, the ultimate luxury is access to curated moments, networks, and opportunities.

Bridging the divide. With these factors in play, wealth management firms that don't adapt could be set for a rude awakening. Some 80% of Gen Z high net worth individuals we surveyed said they plan to leave their parents' wealth management firm within one to two years of receiving their inheritance. The reasons, in my view, are clear: lack of digital sophistication, generational disconnect, and outdated service models. Here are three actionable steps firms can take to retain Gen Z loyalty as they continue to accumulate wealth.

   -- Build teams that reflect next-generation clients: Deploy younger, 
      digitally native advisors who understand Gen Z's mind-set. Track talent 
      pipelines to ensure continuity, as nearly half of today's advisors -- 48% 
      -- are expected to retire by 2040. 
 
   -- Offer lifestyle and luxury partnerships: Collaborate with concierge 
      services and luxury brands to deliver exclusive experiences that enrich 
      and simplify clients' lives. 
 
   -- Prioritize digital-first solutions: Ensure that clients have seamless, 
      omnichannel access to accounts and planning tools. One in four advisors 
      surveyed expressed dissatisfaction with their firm's ability to support 
      Gen Z clients. Digital-first services give more power to the client and 
      free up advisors to focus on crafting financial plans and delivering 
      sound advice. 

These changes don't have to represent a break with tradition. Buffett succeeded by tuning out the noise of daily market movements and connecting with what drove value for him and his shareholders. Likewise, winning Gen Z means connecting with what moves them but the real shift is in seeing the world as Gen Z's eyes: as a global opportunity with ever-broadening horizons.

Kartik Ramakrishnan is the CEO of Capgemini's Financial Services Strategic Business Unit and a member of its Financial Group Executive Board. He works directly with C-level executives at the world's top financial institutions to help set business and technology goals.

This content was created by Barron's, which is operated by Dow Jones & Co. Barron's is published independently from Dow Jones Newswires and The Wall Street Journal.

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October 29, 2025 14:22 ET (18:22 GMT)

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