The world’s total net wealth has hit $431 trillion, nearly half a quadrillion dollars, and over a quarter of it is controlled by millionaires.
That $431 trillion figure includes “the sum of financial wealth and real assets, net of liabilities,” explains Anna Zakrzewski, author of a new report from Boston Consulting Group.
High net worth individuals (HNWIs), or people worth over $1 million, own a quarter of the total, approximately $126 trillion, according to the Global Wealth Report, which was published on Thursday.
When it comes to financial wealth (which includes investable assets such as cash, equities, funds and bonds), the share controlled by HNWIs is even larger at 40%. The amount of financial wealth in the world reached $250 million in 2020, having grown 8.3% despite the pandemic’s worst effects.
“Last year people couldn’t spend so they saved,” says Zakrzewski, a partner and global leader at the Boston Consulting Group’s Wealth Management segment.
Then, “flush with cash and encouraged by the prospect of robust returns,” individuals put more of their wealth into equities and investment funds and away from lower-yielding debt securities, says the report.
These benefited from the rebound of stock markets following their spectacular crash in April 2020. Since HNWIs own more equities and other financial products than non-millionaires, their wealth has risen accordingly.
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At the top end of the high net worth segment, billionaires have seen their fortunes soar. Forbes annual billionaires list now includes 2,755 billionaires, who collectively grew their wealth from $8 trillion in 2020 to $13.1 trillion this year.
Boston Consulting Group predicts this wealth is only going to increase over the next five years, surpassing the half-quadrillion dollar mark as major economies claw back their pandemic losses.
$65 Trillion Created Over The Next Five Years
The total amount of financial wealth in the world is set to grow by $65 trillion between 2020 and 2025. Including real assets, the world’s total net wealth will surpass $500 trillion sometime before 2025.
However, the share owned by individuals with more than $100 million will grow the fastest. Boston Consulting Group calls these people “ultras.”