By Axelle Bedouch
The global financial landscape is undergoing a profound transformation as women’s wealth continues to grow at an impressive rate. The term “Great Wealth Transfer” refers to the massive shift of wealth from the Baby Boomer generation to younger generations, a process that is expected to accelerate in the coming decades. According to BCG, women now control approximately 33% of the world’s wealth, and this figure is expected to continue growing in the coming decades. This shift is part of the larger trend of generational wealth transfer, where trillions of dollars are being passed on, with women set to inherit a substantial portion of this wealth.
The Great Wealth Transfer is projected to see women inherit up to $30 trillion in the United States alone by 2030.(1) In addition to this inheritance, women are adding $5 trillion to the global wealth pool annually, with their wealth growing at an annual rate of 7.2% from 2019 to 2023, compared to 6.1% from 2016 to 2019.(2) As women gain greater financial control through inheritance and their own earnings, their investment behaviors are shifting toward more socially responsible practices, reflecting a desire to align financial decisions with personal values.
This article explores the reasons behind this growing wealth among women, the changes in their financial behaviors, and the obstacles they face in managing and inheriting wealth. As women gain more control over their financial futures, they are not just accumulating wealth—they are changing the way wealth is viewed and invested in the financial world.
Part I. Why This Shift in Wealth?
1) The Generational Shift in Wealth
The “Great Wealth Transfer” refers to the significant shift of wealth from the Baby Boomer generation to younger generations, and it plays a pivotal role in the growing financial power of women. Baby Boomers—who hold a substantial portion of global wealth—are expected to pass down their assets to their children in the coming decades. Notably, women are set to inherit a large proportion of this wealth. According to McKinsey, women are poised to inherit up to $30 trillion in wealth in the U.S. by 2030.(3) This shift in wealth is not merely a transfer of assets but also a transfer of decision-making power, as women increasingly take on leadership roles in managing inherited wealth. Historically, women were often passive participants in wealth management, but this generational wealth transfer is positioning them as more active decision-makers.
This transfer is set to dramatically reshape the financial landscape, positioning women not only as inheritors of wealth but as key players in the future of finance. As women inherit significant financial assets, they are moving away from the traditional passive role they once held in wealth management, taking more strategic and informed decisions about how to grow and allocate their resources. The Great Wealth Transfer is thus redefining the way wealth is accumulated and managed, with women now at the center of this shift.
2) Women’s Presence in the Workforce and in Leadership Roles
Women’s increasing participation in the workforce is another important factor driving this shift in wealth. Over the past few decades, women have made tremendous strides in breaking barriers across industries that were traditionally dominated by men. Sectors such as law, technology, and finance are seeing more women, who are not only earning higher salaries but also accumulating wealth through their careers. The latest NALP national survey showed that the number of female law partners in the United States had grown from just 10% in 1991 to 28% in 2023.(4) The number grows every year, but slowly – by less than one percentage point annually. According to WomenTech Network, women make up 35% of employees in STEM fields in the world today, a significant improvement from the early 2000s when they only made up 9%. And Deloitte found that women’s representation in senior leadership positions in the global financial services industry has steadily increased and will continue to increase from 12.1% in 2012 to 21.8% by 2031, reflecting significant progress in gender diversity at the highest levels of finance.
Moreover, women are increasingly assuming leadership roles within the organizations. More women are becoming CEOs, executives, and board members, directly influencing company strategies, investments, and wealth accumulation. The McKinsey Global Institute has estimated that closing gender gaps in labor-force participation and leadership roles could increase global GDP by as much as 12-25% by 2025.(5) This shows the immense economic potential unlocked by empowering women, not just through inheritance, but through their own earning power in the workplace. As women rise to these influential roles, they are reshaping not just corporate financial structures but the global financial ecosystem as a whole.
3) Financial Independence Through Career Advancements
A key aspect of the growing wealth of women is their increasing financial independence, which is being achieved through career advancements and entrepreneurship. As more women advance in their careers, particularly in high-paying industries such as finance, technology, and law, they are building their own wealth, which is contributing to the broader economic shift. Additionally, the rise in female entrepreneurship is playing a crucial role in driving wealth accumulation. A 76% increase in startup activity among women globally from 2001 to 2021, as reported by the Global Entrepreneurship Monitor (GEM), underscores the growing role of women in wealth creation.(6) Women entrepreneurs, especially in fields like technology and consumer goods, are not only driving innovation but also contributing to economic growth, creating jobs, and building substantial wealth.
Part II. Changing Financial Behaviors – The Rise of Socially Responsible Investing
As women accumulate more wealth, there has been a significant shift in investment behaviors. Women are increasingly prioritizing long-term financial security and sustainability, leading to the rise of socially responsible investing (SRI). This is not just a trend—it’s a reflection of women’s desire to invest in ways that align with their personal values and contribute positively to the world.
“The next generation of females seeks not only returns, but also purpose. They don’t just want more, they want better. This is not just about money for them. This is about meaning, connection, leaving a legacy for the next generation and making a difference in the world.” Anna Zakrzewski (Managing director and partner at Boston Consulting Group)
1) Prioritizing Long-Term Financial Security
One of the key factors driving this shift is women’s tendency to prioritize long-term financial security over short-term gains. Studies tend to suggest that women tend to be more risk-averse than men, often opting for investments that offer stable, reliable returns. (7) Unlike men, who are more inclined to take higher risks for potentially higher rewards, women’s investment strategies tend to focus on preserving and growing wealth gradually.
Women are more likely to invest in low-risk assets such as bonds and mutual funds. These asset classes tend to offer steady growth over time, making them attractive to women who seek financial stability and security, particularly considering increasing economic uncertainties. The preference for lower-risk investments reflects women’s broader financial goals, which often focus on creating sustainable wealth that can support their families and future generations. This more conservative investment approach is not necessarily about avoiding risk entirely, but rather about taking a thoughtful, long-term approach to financial growth.
The Bank of America Private Bank’s 2022 Study of Wealthy Americans also supports this by highlighting that women investors are more likely to believe that sustainable investing can have a positive impact on society. (8) This mindset of prioritizing long-term, stable returns while contributing to positive societal outcomes supports the rise of socially responsible investing among women.
2) The Growing Trend of SRI and Impact Investing
The rise of socially responsible investing (SRI) is one of the most notable shifts in women’s financial behavior. SRI involves choosing investments based on criteria that align with personal values, particularly with regards to environmental, social, and governance (ESG) factors.
A UBS Investor Sentiment Survey (9) provided valuable insight into the growing role of sustainability in women’s investment decisions. The survey revealed that 71% of women take sustainable considerations into account when making investment decisions, compared to only 58% of men. This stark contrast highlights how women are more likely to prioritize environmental and social factors when choosing where to invest their money. This increasing preference for SRI is not only a matter of personal values but also a recognition of the long-term benefits that sustainable investments can provide, both in terms of financial returns and societal impact.
Moreover, the UBS survey highlights that women are also particularly interested in investing in other women, reflecting a broader commitment to advancing gender equality in the investment space. Women investors are more likely to support businesses and funds that are led by women or focus on gender-inclusive practices.
3) Adapting Wealth Management Firms
As the demand for socially responsible and ESG-focused investments continues to rise, wealth management firms are responding by adapting their services to meet the evolving needs of female investors. Financial institutions are increasingly offering tailored products to those who want to align their portfolios with their values. Many wealth management firms are now introducing ESG-focused funds, which provide investors with opportunities to invest in companies that meet high standards for environmental stewardship, social responsibility, and corporate governance.
However, despite these positive developments, research by EY suggests that many women still feel misunderstood by their wealth managers. (10) According to the firm’s findings, 67% of women globally report that their financial advisors do not fully understand their financial goals, particularly when it comes to socially responsible investing. This disconnect between female investors and their wealth management advisors is leading many women to seek alternative wealth management services that are more aligned with their values.
This dissatisfaction becomes more pronounced when women face significant life events, such as the death of a spouse. Research indicates that 70% of women switch their wealth management relationships to a new financial institution within a year of their spouse’s death. This statistic highlights the critical need for wealth managers to build trust and offer personalized services tailored to women’s unique needs, especially during major life transitions. Women often feel that their previous financial advisors did not adequately support them in managing wealth after the loss of a partner, prompting many to seek out advisors who can better address their goals, values, and financial aspirations. (11)
As women increasingly demand investments that reflect their personal beliefs, the wealth management industry is being forced to adapt. Some financial institutions are launching new products focused specifically on SRI and gender-focused funds, while others are seeking to increase their understanding of the unique needs of female investors. The financial sector is also seeing a rise in the number of women-focused investment networks and advisory firms that are catering to this growing demand for values-based investing. These firms are helping women to not only grow their wealth but also ensure that their investments reflect the positive impact they wish to create in the world.
Part III. Obstacles to Managing and Inheriting Wealth
Despite the growing wealth among women, several significant barriers remain when it comes to managing and inheriting wealth. Legal obstacles, social expectations, and financial literacy challenges continue to prevent women from fully accessing and controlling inherited wealth. These barriers are often deeply rooted in legal frameworks, societal norms, and a lack of education, which limit women’s financial independence and hinder their ability to maximize the potential of their wealth.
1) Legal Obstacles and Inheritance Laws
In many parts of the world, women continue to face significant legal barriers when it comes to inheriting wealth. In regions such as South Asia, the Middle East, and Africa, restrictive inheritance laws prevent women from fully inheriting or controlling assets. For example, in Tunisia, although the country is often seen as more progressive in terms of gender equality, its inheritance laws still exhibit gender discrimination. According to a report from The European University Institute, Tunisian inheritance law stipulates that women are entitled to half the inheritance of men under normal circumstances. (12) This disparity, where a daughter inherits half of what a son receives from a parent's estate, exemplifies ongoing gender bias in inheritance laws, limiting women’s ability to build and control wealth.
2) Societal Pressures and Expectations in Wealth Management
Social norms and societal expectations continue to play a significant role in how women manage inherited wealth. In many cultures, women are expected to defer financial decisions to male relatives, even when they inherit significant assets.
Gender roles further complicate wealth management. In many societies, women are expected to take on caregiving responsibilities, often leading to career breaks for maternity leave or pauses in their professional careers. These interruptions in employment can impact their long-term financial security, limiting opportunities for wealth accumulation and making it harder to build the same level of financial independence as their male counterparts. Such breaks in career continuity may also contribute to the gender wealth gap, as women’s earning potential and access to retirement savings are often compromised.
Beyond these cultural expectations, women also face pressure to focus on charitable giving and socially responsible investing (SRI). While these investment strategies can contribute positively to society, they often provide lower financial returns compared to traditional investment methods. Additionally, societal expectations often push women to allocate wealth toward charitable causes, sometimes at the expense of their own financial growth.
3) Financial Literacy and Confidence
A critical challenge preventing women from fully managing their wealth is the widespread lack of financial literacy. Women are often less confident than men in making investment decisions due to historical gaps in financial education. Research from ABN AMRO reveals that over 40% of women lack confidence when it comes to making investment decisions, compared to 30% of men. (13) This disparity in confidence is rooted in a broader historical trend where women have had less access to financial education and fewer opportunities to engage in wealth management, particularly in areas like investing.
This financial literacy gap has significant consequences for women’s ability to grow and manage their wealth. Women may hesitate to engage in higher-risk investments or fail to fully leverage their inherited wealth due to a lack of understanding or confidence in financial markets. For instance, many women still rely on their spouses or financial advisors to manage their investments, which can be problematic when they inherit wealth but lack the skills to independently manage it.
According to the World Economic Forum, men are generally more prepared to inherit money than women, with 32% of men who received or expect to receive inheritance, compared to only 28% of women.(14) The forum's findings show that women often feel less equipped to make financial decisions, with a third of women expressing doubts about their ability to pass down wealth effectively due to economic pressures and limited knowledge about financial planning.
Financial literacy programs aimed specifically at women, such as Ellevest, are working to bridge this gap by providing women with the resources and confidence they need to take control of their financial futures. (15) These initiatives encourage women to become more involved in financial planning, investing, and wealth management, empowering them to make informed decisions about their money.
Conclusion
The growing wealth of women is not only reshaping their financial futures but also redefining the dynamics of the Great Wealth Transfer. As women increasingly take control of their wealth, they are challenging traditional investment behaviors and creating a new investment landscape that prioritizes sustainability, social responsibility, and long-term financial security.
However, significant obstacles remain, including legal barriers, social expectations, and financial literacy gaps. As highlighted in the Bank of America report, although wealth will be distributed more equally between men and women, it will remain concentrated in wealthy countries and among affluent families. (1)
Empowering women through targeted financial education, policy reforms, and inclusive investment strategies is essential to enabling them to thrive financially. By driving demand for financial services that truly reflect their needs and values, women are shaping a more inclusive and sustainable financial future.
Footnotes
(1) Bowley Taylor (March, 2024) https://institute.bankofamerica.com/content/dam/transformation/rising-wealth-of-women.pdf.
(2) Zakrzewski Anna, Newsom Reeves K., & al. (April, 2020) https://www.bcg.com/publications/2020/managing-next-decade-women-wealth.
(3) Baghai Pooneh, Howard O., & al. (July, 2020) https://www.mckinsey.com/industries/financial-services/our-insights/women-as-the-next-wave-of-growth-in- us-wealth-management .
(4) Taylor Danielle, Gray Nikia (January, 2024) https://www.nalp.org/uploads/Research/2023NALPReportonDiversityFinal.pdf
(5) Woetzel Lola, Madgavkar Anu, & al.K (September, 2015) https://www.mckinsey.com/featured-insights/employment-and-growth/how-advancing-womens-equality-can- add-12-trillion-to-global-growth .
(6) Elam Amanda, Hughes Karen, & al. (2024) https://gemconsortium.org/report/202324-womens-entrepreneurship-report-reshaping-economies-and-comm unities-2 .
(7) Eagly, A. H, (1997) https://psycnet.apa.org/doiLanding?doi=10.1037%2F0003-066X.52.12.1380.b (8) Bank of America, “2022 Private Bank Study of Wealthy Americans,” (2022)
(9) UBS, “Investor Sentiment Survey,” (2022)
(10) EY, “Women and Wealth: Optimized,” (2017) https://eyfinancialservicesthoughtgallery.ie/wp-content/uploads/2017/03/EY-women-and-wealth_Optimized. pdf .
(11) Duquesnay Blair, (June, 2019) https://www.fa-mag.com/news/women-inherit-the-power-of-the-purse-45001.html?issue=317
(12) Hauser Christina, (January, 2024) https://lafonte.eui.eu/2024/01/25/tackling-gender-discrimination-lessons-from-tunisian-inheritance-law/#:~:t ext=Gender%20discrimination%20in%20inheritance%20is,a%20parent's%20bequest%20than%20men .
(13) Koekkoek Eunice, (April, 2023) https://www.abnamro.com/en/news/over-four-in-ten-women-lack-confidence-to-invest .
(14) Haas Lena, (July, 2024) https://www.weforum.org/stories/2024/07/women-inheritance-great-wealth-transfer/.
(15) The Dura Society, (2024) https://www.thedurasociety.com/the-edit/the-rising-power-of-womens-wealth#:~:text=For%20example%2C %20a%202020%20report,and%20increased%20access%20to%20education .
About the Author
Axelle Bedouch
Axelle Bedouch is a student currently studying management and finance at EDHEC Business School. She is going to do her exchange semester at Copenhagen Business School, through which she will further hone her academic and professional skills. Having lived abroad in The United States during her childhood and teenage years, she is fluent in English and has a strong international outlook. Passionate about pursuing a career in sales and trading, Axelle is eager to deepen her expertise in global financial markets. She is committed to gaining practical experience and applying her international perspective to her future professional endeavors.
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