The good news for wealth managers is that both the population and wealth of high-net-worth individuals are at record highs, and trust in advisors also rose sharply last year. However, those wealthy clients under 40 will require a lot more attention in the future.

The population of high-net-worth-individuals (HNWIs) with more than $1 million in investable assets in the U.S. jumped 17% to 4 million and their investable wealth rose by 18% to reach nearly $14 trillion, according to the U.S. Wealth Report 2014 released by Capgemini and RBC Wealth Management.

Trust in wealth managers and firms increased 12 percentage points each to 84% and 87% respectively, according to a survey done for the report.

"The fact that trust is up is really good news," says William Sullivan, head of Capgemini's Global Financial Services Market Intelligence. "But the real challenge for wealth managers is that despite an increase in trust, the assessment of their performance was down overall, and especially from clients under 40."

YOUNGER CLIENT DEMANDS

Paradoxically, that discrepancy is being driven by clients' "huge expectations" as a result of the continuing bull market, Sullivan believes.

In addition, the report showed that younger HNWIs are demanding more digital contact from their advisors, see their needs as more complex, are more interested in social impact investing and want more family wealth advice, Sullivan notes.

To be sure, the U. S. wealth market is on a roll. Thanks to a continued economic recovery, strong equity market performance, rising real estate values and record domestic oil production, growth rates of both the HNWI population and HNWI wealth in the U.S. strongly outpaced global averages.

WHERE THE WEALTH IS

A dozen metropolitan markets - accounting for 75% of U.S. HNWI wealth - drove the increases: New York, Los Angeles, Chicago, Washington D.C., San Francisco, Boston, Philadelphia, Houston, San Jose, Dallas, Detroit, and Seattle.

Markets with a technology and energy orientation, including Dallas, Houston and San Jose grew the fastest, while New York remained the top wealth market by far, with 894,000 HNWIs and over $3.2 trillion in assets (second-ranked Los Angeles has 330,000 HNWIs and over $1.2 trillion in assets). However, New York recorded the second lowest growth rate (12%) in HNWI population of the top 12 markets, ranking only slightly higher than Detroit (11%).

MILLENIAL MINDSET

According to the survey, wealthy clients in the U.S. overwhelmingly preferred to work with a single firm versus multiple firms.

"It's clear that clients want a single point of contact for holistic advice," says Rob Spawn, senior managing director for RBC. "Younger clients especially indicated they would consider leaving a firm that doesn't offer an integrated channel experience."

Wealthy individuals under 40 are also highly focused on making a positive impact on society through investing time, money or expertise, the survey found, with 81% citing driving social impact as extremely or very important.

Female HNWIs are also focused on driving social impact, with 62% citing it as extremely or very important, compared to 50 % of their male counterparts.

The preferences and increasing importance of women and younger wealthy clients was a key takeaway from the report, according to Sullivan. "We need to make sure we have tailored offerings for female and millennial investors," he says.

Read more: