Article written by Chloe Walker. Published in Financial Standard July 15, 2023.

Developing a wealth transfer plan remains on the to-do list for Australia's wealthiest, according to LGT Crestone's latest State of Wealth report.

The report, now in its fourth year, uncovered nearly two thirds of Australian high-net-worth (HNW) and ultra-high-net-worth (UHNW) individuals do not have a wealth transfer plan in place.

However, the majority have intentions to develop one - representing an estimated $4.7 trillion in future wealth transfers.

When it comes to the sexes, 41% of men have a clear plan for the wealth transfer process, in comparison to 31% of women.

Unsurprisingly, wealth transfer is more top of mind for individuals aged 60 years and above who are most likely of all the age cohorts to have a plan (48%) compared to 26% of those aged 29-59 years and above who do not.

"Given the majority who intend to transfer wealth, there is a great need for assistance from trusted professionals and service providers to work with them to develop streamlined strategies for transferring wealth," LGT Crestone said.

"Further, by working with families on their wealth plans, professionals are likely to receive referrals from both within and outside the family, offering significant growth opportunities."

To realise this opportunity, however, LGT Crestone said financial advisers will need to combat HNWI's concerns over the misuse of money and tax implications.

"While it is only 10% who report feeling "very worried" about wealth transfer, their top concern is that their wealth might be misused or poorly managed (38%), closely followed by tax implications (37%)," it said.

The distribution of wealth not as intended (34%) and simply how to do it (32%) are also concerns.

According to the report, will-based plans are the most common way to transfer wealth, with 62% of HNWs having a will and 35% undecided on them.

Commenting on the report, LGT Crestone chief executive Michael Chisholm said despite its importance, it is evident that developing a clear plan remains a huge challenge for wealthy Australians.

"Even for the many individuals who recognise the need for a transfer strategy, the obstacle is simply where to begin," he said.

"The wealth transfer process is one that is deeply personal and unique to each family. We see a significant need for assistance from trusted advice professionals to help introduce the discussion and broaden it to include more family members."