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Women bring to the table a unique perspective on money management, reflected in the decisions they make every day to be conscious consumers, preserve their assets, and protect the ones they love. Increasingly, they also bring personal wealth.
According to research, women already control more than $10 trillion in financial assets. But that number is projected to nearly triple in the decade ahead.
Indeed, two-thirds of existing baby-boomer assets are currently controlled by joint households and the bulk of those assets ($30 trillion) will eventually pass to the female spouse — who tends to be younger and live longer — to manage independently, according to McKinsey & Company. This transfer of wealth between spouses, sometimes called the horizontal wealth transfer, it projects, will be comparable in size to the annual U.S. gross domestic product.1
Today, much of the wealth that women control is inherited, but a growing percentage is entirely self-made. Globally, roughly 45 percent of ultra-high-net-worth women with assets of $30 million or more are self-made.2 Interestingly, a recent Julius Baer global report on affluent women found that the U.S. is the only country studied where the share of women among self-made billionaires is larger than the share of those with inherited wealth.3
The great wealth transfer to women, of course, doesn’t end with the baby boomers. Those assets will one day be handed down as an inheritance to their Gen X and millennial children, generational cohorts that are noted for having record numbers of women who are choosing to remain single and are highly focused on financial independence — further cementing women’s role as key financial decision-makers.4
“As women increase their net worth and financial literacy, they are more apt to focus on this for their daughters, which will serve to continue the uptrend in female financial empowerment,” said Robin Lovely, founder and managing partner of The Women’s Advisory Group in Marshfield, Massachusetts.
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The economic effects of the horizontal wealth transfer
The horizontal wealth transfer has profound implications for the U.S. economy, as women use their growing financial clout to effect social change and influence policy decisions.
A recent Bank of America study, for example, found that U.S. women are more likely to engage in impact investing and favor brands that share their beliefs on social, environmental, and ethical issues. Roughly 85 percent of affluent women in America, it found, align their purchasing decisions with their values at least some of the time, and 10 percent of affluent women participate in sustainable or impact investing.5 (Related: Social impact investing: Will you pay more to do good?)
Women with wealth are also highly engaged in philanthropy, establishing themselves as prominent public figures with the power to control outcomes. Currently, the vast majority (85 percent) of charitable giving decisions are either made or influenced by women, with millennials and Gen Z favoring organizations that help combat climate change. And, as their income grows, women are more likely to give, and to give more, than their male counterparts.6,7
Lastly, women in the workplace are fierce advocates for diversity and inclusion, using their entrepreneurial spirit to support one another and promote pay parity. At present, roughly 14 million businesses in the U.S. are female-owned, employing 12.2 million workers and generating $2.7 trillion in revenue, according to a 2024 Wells Fargo report. From 2019 to 2023, the number of women-owned businesses has grown at nearly double the rate of those owned by men, which is perhaps no surprise given that self-employment provides primary caregivers an opportunity for a better work-life balance and an opportunity to circumvent the glass ceiling.
As they build and grow their business, studies show that women are also more inclined to hire diverse individuals and promote supplier diversity, a proactive business practice of sourcing goods and services from minority-owned suppliers and vendors.8
Building a better safety net
With women’s growing position of financial strength, of course, comes an equally important opportunity to protect their interests closer to home.
Many are already taking steps to build and protect their wealth for future generations by working with a financial professional to help them confidently meet their goals.
“In our role as financial professionals, we know that women tend to prioritize long-term financial security and asset preservation over higher-risk capital growth strategies,” said Lovely. “That includes retirement savings, taxable investments, education funding for their kids, and insurance protection. This can be an overall positive for family wealth.”
Jennifer Mann, a vice president at Lenox Advisors in Chicago, added that many of her female clients also favor products that help them hedge against longevity risk, or the likelihood of outliving their assets. That’s a prudent plan given that women:
- Tend to outlive men by an average of roughly five years.
- Are statistically more likely to require assisted care as they age.
- Have less saved for retirement due to lower lifetime earnings.
“Assuming they are in decent health, a wise plan would be to help insure against these risks with protection products, such as annuities and long-term care insurance, which can potentially help to mitigate the threat of depleting your resources if you live longer than expected,” she said. (Related: Why women should be selfish with their finances)
Annuities can provide a guaranteed income stream for life, potentially along with upside growth potential, while long-term care insurance and life insurance policies with a long-term care rider may help pay for assisted living or nursing home care expenses that Medicare typically doesn’t cover.9
Other ways women are choosing to protect their financial interests include:
- Saving a disproportionately larger share of their income for retirement.
- Delaying Social Security until their full retirement age, and potentially beyond, to maximize the size of their monthly benefit.
According to Lovely, wealthy women may also be more inclined to gift money during their lifetime so they can enjoy helping their adult children reach their own financial goals, rather than leaving behind a large inheritance. That can help reduce the size of their taxable estate. For that reason, tax and legal professionals are a vital part of the holistic financial planning process. (Learn more: Lifetime gifting: Benefits and considerations)
Indeed, wealthy women who wish to leave a financial legacy should carefully consider tax efficiency — especially now with the estate tax lifetime exemption limit set to be cut in half at the end of 2026.
A number of strategies exist that may help. For example, a whole life insurance policy can be put into a trust for the benefit of the people you love, which can help protect those dollars from creditors and potentially provide your beneficiaries with a guaranteed tax-free death benefit immediately after you pass away. If structured properly, the insurance proceeds would be outside your estate and can be used by the trustee to purchase assets from your estate, providing your personal representative or executor with the funds to help pay any inheritance tax they may owe, cover funeral expenses, or pay off debts.
An airtight estate plan is also essential to ensure that their end-of-life wishes are made clear and that their assets are distributed according to their wishes after they’re gone. (Learn more: What is estate planning and why is it important?)
Estate planning documents should include a:
- Will
- Living will
- Financial power of attorney
- Health care proxy
Conclusion
Women control more wealth than ever before, and, as their net worth continues to grow, they stand at the forefront of a new frontier — ready to use their position of power to confront social challenges and promote economic stability.
With careful financial planning, they can also help protect their wealth for future generations so their legacy lives on.
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Frequently Asked Questions about the horizontal wealth transfer
Q: What is the horizontal wealth transfer?
A: The horizontal wealth transfer refers to the movement of wealth between spouses — specifically, the shift of assets from joint households to female partners who tend to be younger and live longer. According to research, an estimated $30 trillion in baby-boomer assets is expected to make this transition over the next decade, a sum comparable in scale to the entire U.S. annual GDP.
Q: What does horizontal wealth transfer mean for household financial planning?
A: It means women are increasingly likely to be the sole financial decision-makers in their households, either by choice or circumstance. That makes it important to be engaged in financial planning now — understanding your household's assets, insurance coverage, investment strategy, and estate plan — rather than waiting until a transition forces the issue.
Q: What financial products should women prioritize to protect their wealth?
A: Life insurance, disability insurance, and annuities are among the products women often consider to help their assets and the well-being of the people they love. A financial professional can help you identify which combination of tools aligns with your specific goals, timeline, and risk tolerance.
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1 McKinsey & Company, “Women as the next wave of growth in U.S. wealth management,” July 29, 2020.
2 Julius Baer, “The rise of multi-millionaire women,” March 19, 2024.
3 Julius Baer, “The rise of multi-millionaire women,” March 19, 2024.
4 Pew Research Center, “A record-high share of 40-year-olds in the U.S. have never been married,” June 28, 2023.
5 Bank of America Institute, “The Rising Wealth of Women,” March 13, 2024.
6 Indiana University Indianapolis, “Charitable Giving by Affluent Households Above Pre-Pandemic Levels, Finds 2023 BofA Study of Philanthropy,” Oct. 3, 2023.
7 Bank of America, “Charitable Giving by Affluent Households Above Pre-Pandemic Levels, Finds 2023 BofA Study of Philanthropy,” Oct. 3, 2023.
8 Ernst & Young, “Seven critical learnings about women entrepreneurs,” Aug. 20, 2024.
9 Guarantees are contingent upon the claims-paying ability of the issuing company.
