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Wealthy Investors Anticipate Long-Lasting Lifestyle Changes After COVID-19: UBS

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Three-quarters of investors around the world, and more than four in five in the U.S., have concluded that life will never again be the same because of the coronavirus pandemic, UBS reported Monday.

Eight-six percent of American investors said a sense of fear would linger for the foreseeable future.

Globally, about 70% said they planned to travel less and do more work remotely, and about half said they were considering moving to a less populated place. About half of respondents said they were thinking of moving closer to family.

UBS conducted a survey in May among some 3,750 investors in 15 markets, including about 1,000 in the U.S. The sample comprised individuals 25 to 30 years old with at least $250,000 in investable assets, those 31 to 39 with at least $500,000 and those 40 or older with at least $1 million in investable assets.

Seven in 10 investors worldwide said they had been affected to some extent by the pandemic, with 22% of U.S. investors saying the hit was significant, compared with the global average of 25%.

A majority of investors in the survey said the pandemic had influenced how they think about their money, and in the face of prolonged economic uncertainty, they have developed a number of concerns.

Seventy-seven percent of U.S. investors said COVID-19 had hurt their retirement savings, compared with 65% overall; 44% worried about not having enough money in the event of another pandemic, versus 56%; and 37% were concerned that they would not leave enough for their heirs, versus 54% overall.

Four in five American respondents said they feared further market decline, but three in four also saw volatility as an opportunity. This was on par with investors in other regions.

Millennials Hit Hard

Millennials have been hurt by the coronavirus outbreak more than older investors, raising concerns about having to work longer to make up for losses, not having enough save in the event of another pandemic and losing their job.

Seventy-five percent of U.S. millennials in the survey said the pandemic had affected their finances, compared with 65% of baby boomers. Seventy-two percent of men and 67% of women also said they had been negatively affected.

Even so, many investors still want their money to have an impact. Sixty-three percent of millennials said they were highly interested in sustainable investing, compared with just 27% of boomers — and compared with 69% and 44% globally.

Thirty-one percent of U.S. millennials said they had increased financial support to family and friends because of the coronavirus outbreak.

Seeking Advice

Three and four U.S. investors with a financial advisor said they wanted more guidance than usual.

“As investors navigate the COVID-19 crisis, they are seeking the latest insights and more tailored advice on how to achieve their financial goals,” Tom Naratil, co-president of UBS Global Wealth Management and president of UBS Americas, said in a statement.

“The pandemic is causing many of them to rethink how they’ll fund their liquidity, longevity, and legacy needs. That means wealth managers have an opportunity to play an even more important role in their clients’ lives and prepare them for the post-pandemic environment.”

Global Viewpoints

Latin American investors in the survey felt that they were the most affected by the pandemic, both financially and in terms of their way of life. At the same time, they were likeliest of all investors surveyed to see a silver lining in the associated market volatility.

The pandemic’s effect on European investors (not including Swiss ones) was mostly in line with the global average, except as it related to how they direct their money to make an impact. Forty-two percent of European millennials increased their financial support to family and friends, compared with 34% of millennials globally.

COVID-19 affected Swiss investors less than those in all other regions. Only 56% said their way of life would change permanently, compared with a global average of 75%. Sixty-eight percent said fears related to the effects of the pandemic would persist, compared with a global average of 81%. Only 11% said their finances were significantly affected.

Seventy-one percent of investors in the Asia/Pacific region anticipated permanent changes as a result of the virus, four percentage points lower than the global average.

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