Profiling the new wealthy throws up some surprises
A report from Société Générale Private Banking shows the make-up of the world’s new wealthy and how they run their investments.
Some of the conclusions of the latest Société Générale Private Banking (SGPB) report are hardly surprising: wealth is moving across the globe from West to East.
It is being generated fastest and the most in emerging markets, and the way the new wealthy engage with their investment portfolios is different to how ‘old money’ operated.
But the survey, conducted among 1,200 individuals in 12 countries by Forbes Insights Practice, also reveals that the world’s new ultra high-net-worth individuals (UHNWIs) – who all had a minimum of $60m net worth of investable assets – are relatively young.
The average age in Russia is 49, and in China 50, compared with 66 in the US, or 74 in France.
They tend to be “self-made”, meaning they have created their own wealth rather than inheriting it.
In China, 66% of those polled were self-made, with 65% in India and 67% in Brazil.
The US still leads the world in terms of the number of billionaires, but is now closely followed by Russia and China, with more than 101 and 115 respectively.
These two countries only joined the 100-Billionaire club within the last 12 months.
The report noted younger achievers often face considerable obstacles to success, which they attain through sheer force of will.
“These individuals will probably never retire,” noted Christiaan Rizy of Forbes Insights Practice, editor of the report. “They are serial wealth creators.”
Contrary to the popular image of “floating” global citizens hiding out in tax havens, 90% of those surveyed maintained citizenship and residence in the same country.
Hong Kong was an exception, which the report said “continues to maintain its image as a haven for global wealth”.
Some 28% of those studied held citizenship and residence in other countries. The UK also attracts the ultra-rich from other locations.
In matters of wealth, it is apparently still a man’s world. The study showed most of the UNHW individuals polled were male.
The highest percentage of wealthy females were in Hong Kong (23%) and Germany (17%).
In all markets, except Russia, family ties and connections are extremely strong and important.
In four places – France, Hong Kong, India and the Middle East – more than half of those questioned have children in their own business, while in Russia, just 8% did.
Those in Mexico, Singapore and the Middle East also involved other family members.
The wealthy are variously engaged in political activity: some openly support certain political parties or causes, while others keep their affiliations private.
UHNWIs in the US and India are more open about their political involvement than those in Europe.
Interestingly, despite the recent downturn, philanthropy and charitable giving remain priorities for many ultra high net worth people.