Economic Study: World’s Ultra-rich Getting Much Richer
Posted by Ram Kumar Shrestha on November 22, 2014
The report said 211,275 people qualify as “ultra-high net worth” (UHNW) – those with assets above US$30 million.
A bare 0.004 per cent of the world’s adult population controls nearly US$30 trillion in assets, 13 per cent of the world’s total wealth
WASHINGTON: A bare 0.004 per cent of the world’s adult population controls nearly US$30 trillion in assets, 13 per cent of the world’s total wealth, according to a new study released on Thursday (Nov 21). And perhaps unsurprisingly, the study by the Swiss bank UBS and luxury industry consultant Wealth-X said the concentration of money in the hands of the ultra-rich is growing.
The report said 211,275 people qualify as “ultra-high net worth” (UHNW) – those with assets above US$30 million. Of them, 2,325 have more than US$1 billion. Their numbers grew 6 per cent over the past year, but their wealth grew 7 per cent, as asset markets like stocks and property soared in many places around the world.
The fastest growth, indeed, came in the “demi-billionaire” group worth a half-billion to a billion dollars apiece, the study said. “Even amidst geopolitical conflicts, socio-economic strife, and volatile currency markets, the world’s equity markets displayed strong performances, thereby enabling UHNW individuals’ wealth to increase and their influence across industries and sectors to grow – from their importance in wealth management to their consumption of luxury goods,” it said. “Such a large concentration of wealth in the hands of these few individuals means that they tend to have a large degree of influence, whether on global equity markets or specific industries.”
Of the nearly US$30 trillion this elite group controls, just over one-third is in the hands of tycoons in North America, more than one-quarter in Europe, and 23 per cent in Asia. Of them, 87 per cent are men, of the average age of 59, and nearly one-quarter of them were in banking. Of them, 68 per cent were “self-made” rich, 13 per cent rich by inheritance, and the rest a combination of the two.
The average ultra-rich woman was 57, and more likely to be involved in non-profit and social organisations (19 per cent) than any other sector. Nearly half became wealthy through inheritance, while one-third were self-made wealthy.
As F Scott Fitzgerald wrote, the rich are different. The average UHNW-er spends US$1 million a year on luxury goods and services. Yet, the study points out, luxury items can be “part and parcel of their lifestyle and are not necessarily considered a ‘luxury.'”
“For example, UHNW individuals with private jets use their aircraft not only for leisure, but also for business purposes. On the other hand, while yachts, and particularly superyachts, are usually a non-necessity, many UHNW individuals lead very public lives, and the privacy of a family holiday on a yacht is a very special treat.”