Key Financial Concerns - Families and Individuals with over Half a Million in Investable Assets

Goals

To have a broad understanding of the key financial concerns for families with over $500,000 with investable assets. An ideal example would include graphs as well as information, data, and statistics surrounding the key and most pressing financial concerns to investors and families who have over $500,000 of investable assets. Additionally, and separately, it would also be interesting to understand the people with $500k in investable assets who aren't concerned financially and why they are not concerned.

Early Findings

  • We were not provided a geographic focus for this project, so we assumed a broad approach and looked globally. If a more targeted approach is desired, for example, the United States, this would have to be clearly communicated to us in any reply.
  • In this initial hour of research, we are unable to provide graphs and charts as the platform does not support it, therefore all graphs and charts found in the first hour have been provided in this Google document. If further research is triggered, we can place those graphs and charts directly into the narrative, along with any others we find.
  • According to Personal Capital, people in the United States with more than $500,000 in investable assets are most worried about a financially secure retirement. This is surprising as the median retirement savings for 56 – 61 year olds in America is only around $20,000, but Americans with 25X that amount cite financial security as their top worry.
  • Forty-six percent are worried their portfolios are not properly tax-optimized, while forty-two percent are concerned their portfolios won’t withstand a market downturn.
  • Considering that the median net worth of American families is about $80,000, rich people may not actually have as much to worry about as the rest of America. As the Financial Samurai blog put it, “Affluent investors have to be one of the most paranoid demographics around.”
  • Seven out of every ten investors globally, assert that they were affected in some way by the COVID-19 pandemic and state that it was shaping the way they are thinking about their money.
  • According to Forbes, some key worries investors have are: a recession, government stability, and drastic market corrections,
  • Investopedia asserts that the six key concerns that investors have are: domestic politics uncertainty, international relations, the economy, inflation, interest rates, and regulation/de-regulation.
  • Wealthy investors worry about lack of cash if pandemic returns. More than half of respondents in a survey of wealthy investors by UBS Group AG said they feared not having enough liquidity in the event of another pandemic, while a similar percentage expressed worry about leaving sufficient money to their heirs.
  • Of the wealthy investors surveyed, 70% said they’d been financially affected by the pandemic, with 36% of those describing the impact as “significant.”
  • Younger investors indicated they were disproportionately affected by COVID turmoil. More than 70% of wealthy millennials said their finances were impacted by the pandemic and a similar percentage said they anticipated having to work longer to make up for the losses, compared with just 34% of Baby Boomers. Millennials were also twice as likely as boomers to have extended financial support to family and friends.

Summary Of Our Early Findings Relevant To The Goals

  • As discussed at the top of this document, we were not provided a geographic focus for this project, so we assumed a broad approach and looked globally. If a more targeted approach is desired, for example, the United States, this would have to be clearly communicated to us in any reply.
  • While we did find one or two sources specifically about the financial concerns investors and families who have over $500,000 of investable assets, they were from 2017, which is not ideal. There do not appear to be any recent (2019/2020) publicly available sources that drill down into the "over $500,000" bucket. As Wonder only uses publicly available sources to answer all research questions, we have pivoted the research and looked at "wealthy investors". If further research is required, this is the path we will be scoping for.
  • There is a wealth (pardon the pun) of information about "wealthy" investors so we are confident that this research path will be very productive should further research be desired.
  • Please select one or more of the options provided in the proposed scoping section below.

Proposed next steps:

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