- More than 33% of investors with more than $500,000 in investible assets have lost faith in the “fairness of the market” according to a survey from Cisco’s Internet Business Solutions Group titled “Winning the Battle for the Wealthy Investor.”
• Half expect to delay retirement because of their losses
• Of the 29% of respondents who are under 50, more than 25% switched advisors in the past two years (compared with just 7% of baby boomers and older who switched)
• 33% of the under 50 group plan to leave their advisers in the next year compared with 8% of baby boomers
- China now counts 960,000 individuals with a personal wealth of $1.5 million, up 9.7 percent from the year before, according to the annual Hurun Wealth Report 2011, published by a luxury publishing and events group in Shanghai.
Luxury sales grew 16% in China in 2009 despite global recession, according to a McKinsey & Co. report titled “Understanding China's Love for Luxury.”
• By 2015, they are expected to reach $27 billion, up from the $12 billion rung up last year.
• The 13 million households currently comprising China’s upper middle class (with incomes between the equivalent of $15,000 to $30,000) will grow to 76 million households in this income range by 2015, according to the same McKinsey study.
• However, advertisements that “promote hedonism” or the “worship of foreign-made products will no longer be allowed in China, according to The China Daily newspaper. Among words no longer permitted in ads: “supreme,” “royal,” “luxury,” or “high-class.”
- 61% of the global respondents and 62% of the U.S. respondents have sufficient resources to divide their assets fairly among heirs who work in the business and those who do not, according to PricewaterhouseCoopers’ global family business survey of more than 1,600 family business owners and managers in 35 countries between May and August 2010.
• 14.6% of global respondents do not have sufficient assets to distribute fairly
• 23.6% do not know or have not even considered the issue.
- 60% of 2,000 affluent people (with net worth of $15 million or more) around the world are “nevertirees”—people who plan to continue working, always being involved in commercial or professional work of some kind, whatever their age, according to Barclays wealth Insights study, “The Age Illusion: How the Wealthy are Redefining Their Retirement.” Economist Greg Davies, head of behavioral finance at Barclays Wealth, says, “In previous generations many looked to create their wealth early on in life with a view to enjoying it when they retired.” Many wealthy people today regard work not as a “necessary evil” but “a part of who they are.”
- Most of the 120 of the 165 households responding to a survey, “The Joys and Dilemmas of Wealth” by the Boston College’s Centre on Wealth and Philanthropy—who have at least $25 million in assets and an average net worth of $78 million— do not consider themselves financially secure. What will make them feel financially secure? On average, one-quarter more wealth than they now own.
- About 70% of boomer households will each inherit an average of $300,000, says a Center for Retirement study, “How Important Are Intergenerational transfers for Baby Boomers?” In the aggregate, that comes to $8.4 trillion. The wealthiest 10% will receive an average of $1.5 million.
- The new Forbes Rich List includes 1,209 billionaires in the world, 102 of them women. The greatest growth in their numbers has been in the Brazil, Russia, India and China, fuelled by rising commodity prices. Much of the new wealth comes from the luxury market.
- Only 10% of what advisors do – including estate planning, family planning, tax planning, investment planning – has a direct impact on legacy planning
- Of the 400 wealthiest Americans ranked by Forbes magazine, only 17 appeared on this year’s list of the most-generous donors
- Top five concerns about sustainability of small family offices:
84% cost of providing family office services
78% long-term dilution of family wealth
73% family leadership
67% family cohesion
59% family office leadership and succession
- 200 Countries, 200 Years, 4 Minutes Youtube animation of wealth and health statistics around the world over the past two centuries, from BBC’s “The Joy of Stats.”
- Families that eat together at least four times a week:
• have 48.9% higher mean wealth than those who do not eat together
• increased their mean wealth by 117.4% between 1994 and 2005, compared with families that who do not eat together, who increased their mean wealth by 102.9% during the same period.
- Ninety-Two Percent of Female Retirees Are Not Planning Long-Term for Retirement
five key risks affecting women in retirement:
• Four out of 10 women over 65 living alone depend on Social Security for virtually all of their income.
• Eighty-five percent of women over age 85 are widows, compared to 45 percent of men.
• Forty-six percent of retired women are more likely to expect to pay for assistance than retired men (34 percent), during the less active, somewhat limited stage of retirement. Additionally, 70 percent of retired women are more likely to rely on family or community services for help than retired men, during the least active stage of retirement.
• Health care costs for a retired couple both at age 65 in 2010 can amount, on average, to $250,000 over their retirement years, not including the cost of long-term care.
• Fifty-five percent of female retirees and 76 percent of pre-retirees report the recent recession has made them feel that they need to save more money.
- Who Pays Income Taxes and How Much? Top 1% paid 38.02% of Federal personal income tax in 2008
• Top 5% AGI 58.72%
• Top 10% 69.94%
• Top 25% 86.34%
• Top 50% 97.30%
• Bottom 50% 2.7%
- Wealthy Individuals Use Social Media More Than Most Americans
• 70 percent of high-net-worth individuals surveyed are users of Facebook and other social media sites.
- Family business owners plan to grow, but many have not adequately planned.
• 60% of family firms intend to expand in the next 12 months
• 95% are confident they can compete effectively with their sector market leaders
• Nearly half still don’t have a succession plan
• 50% either lack the liquidity to buy out family members who want to sell their stake or have not considered the possibility
• 62% have not prepared for possible sickness or death of a key manager or stakeholder
- Math skills correlate with wealth.
Couples who score well on a simple test of numeracy ability accumulate more wealth by middle age than couples who score poorly on such a test:
• When both spouses answered three numeracy-related questions correctly, family wealth averaged $1.7 million.
• When neither spouse answered any questions correctly, the average household wealth was $200,000.
• As the numeracy score of each spouse rose, the percent of a family’s portfolio held in stocks increased.
Researchers say the skills needed to make successful investment choices are among the most cognitively demanding that a family has to make, especially as they get older and assume greater control of decisions about their wealth, pensions and health care. The research was supported by grants from the National Institute on Aging to RAND, the University of Southern California and the University of Michigan.
Female-headed households are more likely to give to charity than male-headed households in different income groups. In the $103,000-plus households, women are 95.5% likely to give compared with men who are 75.8% likely to give, according to the Women’s Philanthropy Institute at Indiana University. In all income brackets but the second-lowest, women give more ($1,1910) than men ($984)
Bankruptcies have surged the most among the upper-middle income and affluent, with those earning more than $60,000 a year filing 9.1% of bankruptcies in 2009 vs. 5.5% in 2006.
71% of kids between ages 6 and 16 already understand that we have been in the grips of a recession. Kids of the affluent were most apt to suggest that a parent hold back on a particular purchase -- 31 percent.
- 58% of millionaires in Canada fear children will have a tougher time making it financially than they did. 49% question whether their children are ready to manage a potential inheritance. 35% of them- believe their children may take money for granted and make financial decisions based on a short-term rather than long-term basis. 67% with assets of over $5 million feels a responsibility to preserve wealth for future generations, yet 39% do not have an estate plan in place.
- Gallop World Poll Money may correlate with “life satisfaction” but not “enjoyment of life.”
- 1% of 1,000 respondents (with investable assets of at least $250,000) cited “financial know-how” as the most important life lesson to share with their children, according to The Merrill Lynch Affluent Insights Quarterly. That compares with 54% who mentioned maintaining ties to family, 26% who said choosing the right spouse and 11% who named staying physically fit. The survey also found that 46% are worried about their ability to preserve an inheritance for their children.
Advising the Financial Elite: A Research-Based Discussion of Family Offices The number of financial elite (people with more than $20 million net worth) in the world decreased 18%—from 742,000 in 2007 to 564,000 in 2010; while their aggregate wealth decreased by $15.8 trillion, or 14%.
Wealth Segment Economics Survey The VIP Forum 75% of wealth management firms are rethinking their services to eliminate “over service” and protect profitability.