High-net-worth investors (HNWIs), who are “disenfranchised” with the traditional options available, are moving into the non-custodial space, with advisers citing client preference as the top factor influencing their usage.

HNWIs are classed as those with $1 million in investable assets outside of house and superannuation, and there were around 690,000 HNWIs in Australia in 2024, with the number having grown by 8 per cent from 2023.

In a report by Praemium on non-custodial usage, 41 per cent of advisers said client preference or demand was the top factor influencing the use of non-custodial solutions, beating out cost efficiencies, access to alternatives and increased control.

CoreData founder, Andrew Inwood, said: “It’s about the customisation and the client demand that’s driving their use. If you know the wave of HNWIs moving through the system, the youngest Baby Boomer is 60 this year, and the next wave of people retiring in the ‘great tsunami’ will be those who have been saving since the 1980s.

“The first part of the curve was pretty wealthy and the next wave will be really wealthy, and they will be looking for better outcomes and better solutions. They will be making significant investments and finding ways to generate alpha.”