Last updated: 16:19 / Wednesday, 24 July 2013
4th UBS Investor Watch

Most Millionaires do not Consider Themselves Wealthy

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Most Millionaires do not Consider Themselves Wealthy

Wealth is defined as being able to live one's life with no financial constraints, rather than reaching a specific asset level, but investors feel that it would take at least USD 5 million to be considered wealthy, according to UBS Wealth Management Americas’ fourth UBS Investor Watch.

In addition, of those who have adult children, 80% are providing financial support for adult children, grandchildren or ageing parents. This support ranges from funding education (42%), sharing their home (18%), helping them borrow (20%) and paying for large purchases (18%).
 
A cash cushion of more than 20% goes beyond providing cash for emergency needs and seems to give investors permission to invest other assets more aggressively. This level of cash has been consistent for three years, despite significant equity market gains during that time.

The survey of high net worth (HNW) and affluent investors found that nearly 70% of investors with more than one million in investable assets do not consider themselves wealthy. Investors define wealth as having no financial constraints (50%), as opposed to never having to work again (10%) or being able to afford a luxurious lifestyle (9%). Investors feel that it would take at least USD 5 million in personal wealth for them to be considered wealthy.
 
While the ability to afford healthcare and long-term care remains the top personal concern (27%) for investors, their children’s and grandchildren’s financial situations rank second (20%), trumping the ability to afford retirement (14%) and the potential to outlive one’s assets (14%).

Investors continue to hold high levels of cash (23%), and with large cash holdings use them as a way to reduce their overall risk level. Investors find it important to have cash because they know they are extremely unlikely to lose it and generally find peace of mind in holding a lot of cash.

For your information...

UBS Investor Watch es una publicación trimestral de análisis de la confianza y el comportamiento de los inversores. Su objetivo es generar ideas que ayuden a los Asesores Financieros del bancos y ser la guía de la industria sobre lo que está en la mente de los inversores en estos momentos.

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