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10 interesting trends of the ultra-wealthy for 2016

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The last 10 years have seen a great leap in the number of truly wealthy people around the world, and while growth is expected over the next decade, the latest Knight Frank Wealth Report forecasts a slowdown in the rate of increase.

In fact, the 10th annual survey found that two-thirds of the 400 private bankers and wealth advisors surveyed said they expect that to be the case.

One of the biggest concerns expressed by respondents, who represent 45,000 ultra-high net worth individuals (also known as the UHNW) with at least $30 million each, regards succession and inheritance. More than 60 percent said their children wouldn’t be encouraged to make their own wealth and about half said they wouldn’t know how to invest properly.

The report detailed the attitudes and trends of the richest of the rich and looked back at the last decade and at what lies ahead. Knight Frank found that charitable activities were expected to grow over the next decade compared with the last 10 years. The main motivation cited for philanthropy was personal fulfillment.

Check out 10 interesting findings about the ultra-wealthy:

Biggest risks to wealth creation:

Succession and inheritance issues: 67% over next 10 years (56% for the previous 10 years)

Tax for the Wealthy: 62% (58%)

Global Economic Conditions: 61% (47%)

Stock Market Volatility: 52% (32%)

Online Security and Privacy: 39% (9%)

Compliance Issues: 34% (12%)

Personal and Family Wealth: 33% (28%)

Percent who say wealth creation will slow over next decade:

Latin America: 100%

Australasia: 84%

North America: 68%

Asia: 62%

Africa: 59%

Europe: 54%

Russia & CIS: 50%

Middle East: 47%

UNHW have taken a more active role in managing their wealth over the last decade:

Strongly Agree: 46%

Slightly Agree: 41%

Neither Agree nor Disagree: 8%

Slightly Disagree: 4%

Strongly Disagree: 1%

Most important cities to the UNHW:

(Based on where they live, educate children, spend leisure time and grow their businesses)

  1. London

  2. New York

  3. Hong Kong

  4. Singapore

  5. Shanghai

  6. Miami

Expectations for philanthropic giving:

Increase a Lot: 25% for next 10 years (14% for the previous 10 years)

Increase Slightly: 55% (52%)

No Change: 17% (27%)

Decrease: 4% (7%)

Areas with the most UNHW residents in 2015:

North America: 69,283

Europe: 46,191

Asia: 41,072

Areas projected to have most UNHW residents in 2025:

North America: 90,247 (30% increase from 2015)

Europe: 58,645 (27%)

Asia: 67,999 (66%)

Portfolio asset distribution in North America:

Investments (equities, bonds etc.): 37%

Personal Business: 23%

Primary Residences and Secondary Homes: 22%

Real Estate Investments: 9%

Cash: 7%

Collectibles (art, wine, classic cars etc.): 2%

Precious Metals: 1%

Reasons for collecting luxury items – North America:

Further Diversification: 58%

Act as Status Symbols: 42%

Passion for the Investment: 37%

Tangible: 26%

Better Returns: 11%

Tax Breaks: 16%

Precious Metals: 16%

Top auction items of 2015:

Picasso’s “Women of Algiers:” $179.4 million

12-carat Blue Moon of Josephine Diamond: $48.4 million

Jaguar C-Type: $13.2 million

Patek Philippe Doctor’s Chronograph: $4.9 million

Lockheed Lounge Chair: $3.7 million

See also:

8 tips for working with high-net-worth clients

The road to the high-net-worth market

These are the 12 top U.S. metro areas for high-net-worth prospects

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