5 Major Forces Shaping Wealth Management In 2023

The year 2022 will be regarded to be significant for the worldwide wealth management industry. Wealth managers rushed to digitise their service offerings and enable remote service and distribution as a result of the global pandemic.

As investors sought safe zones for their money, political concerns resulted in a rise in global mobility and record cross-border asset flows. A number of difficulties are anticipated for the world economy in 2023.

Many regions of Europe are experiencing a cost-of-living crisis as a result of supply chain problems and pandemic-driven monetary policies. Inflation increases, rising interest rates, and unpredictable markets appear likely to last for some time. Investors will probably turn to their dependable wealth advisers for advice now more than ever, but they too must be ready to navigate these challenging and uncertain times.

The most progressive and forward-thinking organisations will take advantage of this opportunity to sharpen their strategy, recognise key trends, make investments, boost operational effectiveness, cut down on wasteful spending, and improve their product and service offerings. They will emerge from this in a solid position once normality has returned.

These are just a few of the significant topics that one believes will dominate the thoughts of influential wealth management decision-makers in 2023.

Adoption of Fintech

Wealth managers, particularly those in bigger and much less specialised customer segments, will realise that outsourcing to a specialised service provider or vendor may be the best way to quickly expand a product or service offering in light of increasing costs and customers’ increased demands.

More widespread use of bank and fintech cooperation was something they expected to see in more specialised fields like news and content management or cryptocurrency trading. In order to address some of their wealth management demands, clients may choose to build direct partnerships with reputable fintech providers, particularly with those non-financial entities with which they already have a solid rapport, such as telecoms or super-app providers.

The Transfer of Generational Wealth

This trend will continue to be crucial for wealth managers who target customers with higher net worths because it is predicted that between 40 and 60 trillion dollars will be transferred from the initial baby boomers to their Gen X and Millennial children. The company will want to make sure that their clients can receive helpful guidance in difficult areas like healthcare, retirement planning, and inheritance tax, in addition to having a services business in place that will attract a younger client base.

Frameworks Consistent With Environmental, Social, and Governance (ESG)

Younger investors are looking for investments that reflect their core beliefs, according to numerous surveys, and companies that are unwilling or unable to meet client demands for ESG-compliant portfolios run the risk of losing those customers to rival service providers.

Although there are now many tools available to aid in the creation and execution of a strong ESG framework, the product environment has changed, and wealth managers still seem hesitant to integrate these concepts as a key component of their service.

No longer is it true that ESG-compliant portfolios may outperform non-compliant portfolios. More than 90% of S&P 500 firms voluntarily share sustainability-related data with the market, and many of them have established their own sustainability goals. Wealth managers can now provide solutions that can increase returns while still reflecting the investor’s values thanks to the expansion of the universe.


Large financial organisations are frequently criticised for not knowing or comprehending their consumers well enough. Insights that could inspire custom or semi-custom proposals can be generated by using existing client data in an organised way. These will, at the very least, give the impression that the product is special and personalised, and if it is designed properly, it will be more likely to attract the intended market.

Wealth Management Specialists predict a much wider usage of data analytics to drive hyper-personalization at scale as a result of their capacity to utilize both structured and unstructured client data as well as the increased focus on lowering operating costs and expanding market and wallet share.

Custom or Tailored Indexing

Experts observe a sharp increase in customised or custom indexing, which reflects emerging trends centred on hyper-personalization and ESG. Technology developments have made this financially feasible for a wider group of potential investors by reducing the related administrative load.

Clients will be able to use personal indexing to better plan their taxes and take advantage of tax loss collection to reduce liabilities. Additionally, they can lessen concentration risk, which is crucial considering the dominance of a few firms in the world’s major markets.

Finally, wealth management specialists can more quickly design unique portfolios that represent their social values while enabling cheap management costs and substantial diversity using personalised techniques. They predict that as 2023 approaches, decision-makers will likely place more emphasis on adopting fintech, ESG-compliant frameworks, and hyper-personalization for the wealth management industry. The rapid expansion of personal or custom indexing will remain significant, as will a sizable generational wealth transfer.