The way that people manage their money has changed dramatically across generations. What once required a visit to a bank or a financial advisor can now be done in a matter of minutes from a smartphone or a computer. This ease of access has made financial services more convenient and accessible, but it has also created new opportunities for cybercriminals. These risks are not the same for everyone, as different generations have grown up with distinct technology and, as a result, have developed different financial habits.
The intersection between cybersecurity and generational wealth planning is becoming particularly important as wealth is transferred between generations. Understanding how the risks differ between generations can provide a broader perspective on how individuals and families can protect their financial futures.
Each generation uses money differently and, because of this, is subject to different financial risks. These generations can be broken down into four categories: Baby Boomers, Gen X, Millennials, and Gen Z.
As you can see, every generation has a different experience level when it comes to their finances, which creates unique risks for each group. The same technology that makes financial services more accessible to younger generations can simultaneously create new vulnerabilities, while older generations may face a different set of cybersecurity risks.
Historically, transferring wealth between generations meant signing legal documents, writing checks, or even just moving money between bank accounts. While these methods still exist, most wealth transfer today occurs and is controlled digitally. This creates an issue: wealth can only be transferred safely if the digital accounts controlling that wealth are also protected.
Anyone can be a target of a cyberattack, and the attack doesn’t need to directly involve money. The attackers could gain access to an email account through phishing and then attempt to log into your financial accounts. Using the same phishing methods, they can also steal your banking credentials. There are stories of attackers manipulating individuals to give up their information, even going as far as pressuring them to transfer money themselves. These are common scams, and it becomes even more important to protect yourself when your assets are intended not only for your future but for the next generation’s as well.
Transitionary periods, such as the death of a family member, also pose risks. There are many moving parts during transitions, including sharing sensitive documents, account information, passwords, tax records, and personal information. An attacker who gains access to an email can monitor communications and even go as far as impersonating a family member, a financial advisor, or an attorney.
Because generational wealth planning has so many moving parts, cybersecurity can become a real issue if not taken seriously. Both the owner and the recipients of the assets are potential targets, so both parties need to remain vigilant about knowing what to look for in a cyber scam and do everything they can to protect their wealth.
Protecting generational wealth requires protecting both the financial assets and the digital access points to those assets. Here are some ways that you can protect yourself:
As wealth becomes increasingly digital, protecting generational wealth requires more than sound financial planning. It requires a cybersecurity strategy that protects those assets throughout their entire lifecycle, from accumulation to inheritance.
Sources:
Apella Capital, LLC (“Apella”), DBA Apella Wealth, is an investment advisory firm registered with the Securities and Exchange Commission. The firm only transacts business in states where it is properly registered or excluded or exempt from registration requirements. Registration of an investment advisor does not imply any specific level of skill or training and does not constitute an endorsement of the firm by the Commission. Apella Wealth provides this communication as a matter of general information. Any data or statistics quoted are from sources believed to be reliable but cannot be guaranteed or warranted.
This communication is provided for general educational and informational purposes only. It is not individualized investment, legal, tax, or cybersecurity advice, and it does not modify your account, advisory agreement, or account instructions.
Neither Apella Wealth nor its employees will request your password, full account credentials, or multifactor-authentication code by email or text message. If you receive such a request from someone claiming to represent us, do not respond; contact us using a known telephone number or a secure method.