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2013, May 23

The New World of Wealth: Seven Key Trends for Investing, Giving and Spending Among the Very Rich

The New World of Wealth: Seven Key Trends for Investing, Giving and Spending Among the Very Rich

by Economist Intelligence Unit, 19 August 2010
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This EIU report analyzes how the global financial crisis has changed the way the world’s wealthiest individuals invest, give to charity and spend on luxury.

 

Here are the seven key trends identified in this report.

  1. The financial crisis has led to a trust crisis between ultra high net worth individuals and investment experts. In the medium term, there will be more due diligence and hands-on involvement from the very wealthy.
  2. When it comes to where the very wealthy are investing their money, the pendulum has swung from extreme complexity such as hedge funds and derivatives to extreme simplicity such as cash.
  3. The recession has caused an overall downward trend in philanthropic giving, but most very wealthy individuals intend to maintain or increase their level of donations.
  4. Despite maintaining their giving levels, the very wealthy have continued to adopt a more business-like approach to philanthropy that is focused on verifying positive societal outcomes and improving accountability in the charitable sector.
  5. Philanthropy in emerging markets such as India and China is maturing as wealth increases and as governments see the value of harnessing the expertise of wealthy entrepreneurs.
  6. The so-called new austerity does not apply to the very wealthy. They will continue to spend much the same amount as they did before the downturn, but they will be less flagrant.
  7. The very wealthy want luxury goods companies to sell them a quality service and “something that feels special”, over and above the exclusive price tag.
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Economist Intelligence Unit
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