The latest Saltus Wealth Index has just been published, revealing how high net worth individuals (HNWIs) with investable assets of over £250,000 feel about the UK economy, their own wealth and lifestyles.
The twice-yearly Saltus Wealth Index surveyed over 1,000 individuals, and their responses show how priorities and concerns have changed. The biggest threats to individual finances are now seen as: inflation (33%), COVID-19 (30%), exchange rates (25%), cyber security (25%), and geopolitical risks (22%).
And while most respondents (85%) feel generally confident about their own finances over the next six months, the figure is very skewed according to age, with only about half of older people report feeling confident.
Just how much altered over the last six months can be seen when comparing the October 2021 top concerns: then, COVID-19 was the cited as the biggest threat, followed by inflation, return on investments, Brexit and climate change. This time around Brexit and climate change did not even figure in the top five.
Age and wealth differences
For those aged 55 and over, inflation and rising interest rates are now seen as the top risk: just 16% were not concerned about either. Amongst over 65s, just 3% were not concerned about either.
Interestingly, when measured by respondents’ wealth, while those with assets up to £3 million see inflation as the biggest threat, those with over £3 million say climate change is their biggest single concern.
The numbers of people aged between 55-64 who express confidence in the UK economy has been cut in half over the last six months: in October 2021, 68% of respondents in this age group said they felt confident in the UK economy – falling now to 34%. While amongst those aged 65+, the proportion who remain confident has dropped from 53% to just 23%.
“Younger people are generally more confident in the UK economy than older age groups,” conclude the report, “but even here overall confidence has fallen: six months ago, 89% of 18s-24s were confident in the UK economy, dropping to 65%. However, their faith in their own finances remains strong – 92% of this demographic say they are confident about the next six months.”
Age differences in investments
One area where there were stark differences between those aged under 55 and those aged over 55, was “responsible investing”: under 5% of the younger group believed that responsible investing has little or no impact, in contrast to over 25% of the older group.
“Another clear difference between the two age groups,” comments Dr Michael Peacey,
Senior Lecturer, School of Economics, University of Bristol who worked on the report, “is how emerging asset classes (e.g. crypto, NFTs) are used for investment. The younger group were much more likely to hold such assets, and on average held portfolios which were over four times more heavily weighted towards this class than those in the older group.
You can download the full report by clicking on the link below.
https://www.saltus.co.uk/wp-content/uploads/2022/05/Saltus-wealth-index.pdf
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