HNW Individuals Fret Over UK Economy

UK wealth manager Saltus has released its third Saltus Wealth Index report this week – a survey of high net worth individuals” prospects and the prospects for the UK.

The latest Saltus Wealth Index report
reveals that the biggest concern of high net worth individuals is
the state of the UK economy, but they remain positive about their
own finances. 

According to the research, one in nine HNW individuals cite
the state of the economy as their biggest worry, while 17 per
cent say that they feel ‘unconfident’ about the next six months –
rising from 10 per cent in the last wealth index.

When asked about the three biggest risks to their wealth, HNW
individuals cited inflation, rising energy costs and the war
in Ukraine as their top concerns. Overall, one in three
respondents said that inflation was a key concern, but this
almost doubled to 60 per cent amongst HNW
individuals aged over 55, the survey shows. 

However, they remain positive about their own finances with 81
per cent saying they feel confident about the next six months.

This week, the International Monetary Fund pushed the state of
the UK economy onto the global agenday by predicting that the
country’s economy will contract 0.6 per cent this year, and lag
other developed nations because of rises in the costs of living.
Hikes to tax burdens by the current government – such as to
corporation tax – have been also cited by commentators as a
reason for concern about the country’s outlook. And a regular
claim is that Brexit has harmed the country because of its
departure from the European Union’s Single Market.

Saltus and Censuswide surveyed more than 1,000 people in the UK
with investable assets of over £250,000 ($308,000) about their
attitudes towards the UK economy, their own wealth and lifestyle.

Dr Michael Peacey, senior lecturer in economics at the University
of Bristol, who developed the methodology of the Saltus Wealth
Index, said: “The Wealth Index has fallen eight points from 67.7
to 59.5, and every single measure that enters the Index has
fallen – demonstrating that HWNIs’ outlooks have fallen
considerably.”

“Unsurprisingly, concerns about interest rates and inflation have
been the largest driving force, with over 80 per cent feeling
that the increasing interest rates would put a strain on their
cashflow – while confidence in the UK economy has also fallen,
and there has been a noticeable reduction in the proportion
believing that London will remain Europe’s financial capital,” he
continued.

“However, while confidence has fallen markedly, things could be
worse. Given the unprecedented events of 2022, this drop in
confidence is unsurprising,” he concluded.