Wealth trends to watch in 2025

Andrew Haslip , GlobalData's head of content for wealth management and Asia-Pacific (FS), reveals his forecasts for the year ahead

Looking forward into 2025, GlobalData sees private wealth managers having to continue productivity investments to meet the needs of the next generation of investors while being buffeted by major geopolitical challenges that are often directly contradictory to the long-term strategy they are pursuing.

While dealing with international trade disruption, regulatory divergence and resurgent inflation will certainly keep CEOs up at night, expect them to continue focusing on digitisation, environmental and social governance (ESG) investments and international expansion. Here is a selection of what the GlobalData Wealth Management team is watching for in 2025.

Offshore wealth management will need to be nimble to cope with severe international trade disruption

With a trade war in the offing not just between China and the US but also between the US and its Western trade partners, offshore wealth managers will need to adapt quickly to shifts in trade policy. It is important to remember international business interests have long been a key driver of high-net-worth (HNW) offshore investments, pegged at 12.4% globally in 2024, but much more for markets such as India and China.

This year will see severe disruption to such international businesses, making it difficult to ascertain how much new business will be generated in a week and which offshore centres will likely win out, particularly given the US will likely be at the centre of much of the disruption.

Dealing with cryptocurrency in mainstream finance

The latest crypto-winter is over, and 2025 is likely to see a sustained run-up in key coin prices and an explosion of crypto-investment products and channels. All wealth managers will need to revisit their strategies and policies for crypto investing. Clients will demand greater exposure to this fast-growing sector, and the industry will also increasingly become a source of HNW investors, provided wealth managers can safely conduct due diligence and KYC checks on their wealth.

Inflation and interest rates

A key concern for investment and asset managers in 2025 will be the shifting and uneven inflation outlook due to trade disruption and the attendant economic impact, coupled with changes in interest rates around the world and how these are feeding through to various markets. What does this mean for equity investments versus fixed income and cash, but also markets such as commodities and property?

Regulation

Regulation is always a factor for wealth managers. Key regulatory concerns will revolve around any anti-ESG or fairness rules in the US and more operational concerns such as Digital Operational Resilience Act (DORA), with AI regulations also a key concern. A major issue in regulation will be managing regulatory divergence in key areas.

ESG

Wealth managers will continue investing in building up their ESG, thematic and impact investing capabilities, but the focus will shift away from overtly environmental to social and governance criteria. However, they will have to do it in a political climate in North America that is increasingly hostile to the concept as a matter of ideology. We expect continued development of ESG funds and investment and assessment tools, but with launches and rollouts occurring in Europe and Asia.

Shift towards India

Given the expected geopolitical tensions between the US and China and India's continued strong economic growth, there will be a shift in focus for international banks, wealth and asset managers towards India. Attention will turn to the Asian country both as a market for investments and a source of wealth investors in the country as well as the substantial Indian diaspora (both non-resident Indians (NRIs) and those of Indian origin) in key markets in the Middle East and the Anglosphere.

Gen Z and next-generation investing

Given ongoing inter-generational wealth transfer and the growth in the age cohort, more wealth managers and fintechs will roll out propositions, products and services for this age group. As this generally affluent (more so than millennials were at a similar age) demographic ages and becomes more economically active, their needs and views will come to dominate the thinking of wealth managers in a way that neither Gen X nor millennials managed to do. At the same time, the Baby Boomers were the crucial demographic.

Cybersecurity and fraud

Attacks will continue to grow in 2025 as criminals use new technology for fraud schemes, and bad actors, many driven by the dicey geopolitical scene, seek to disrupt leading wealth brands or financial markets. Continued investment in IT security will be crucial. The growth of crypto investments will also raise the role of crypto in fraudulent investment schemes and in laundering the proceeds of all illicit money. Wealth managers must better guard their clients against such schemes and ensure they do not become conduits for illicit money washed via crypto themselves.