Australia’s High Net Worth Individual (HNWI) population is growing fast, and it’s good news for advisers that know how to service them.
According to a recent study published by Capgemini and RBC Wealth Management titled Asia-Pacific Wealth Report, Australia saw its HNWI population grow by 15.1% in 2012. However, the report notes that trust is fundamental to the wealth management industry.
“HNWIs who lack trust may invest more of their wealth into their businesses or real estate, or allocate higher levels to cash. They may distribute their wealth among a number of firms or seek second opinions, restricting the ability of wealth managers to view and manage client wealth holistically and provide sound advice.”
Although the Asia-Pacific region showed high levels of trust in the industry, Australia was closer to the averages in the rest of the world. HNWIs here had slightly lower confidence than the rest of the world (mid-60%) for individual wealth managers and firms, but at close to 45%, they had slightly higher confidence than the rest of the world (approximately 40%) in industry infrastructure.
In contrast to other Asia-Pacific countries, Aussies see their financial needs as relatively straightforward, particularly in the higher age and wealth bands. They said their needs included the management of cash, credit, and growing investments.
Aussie HNW clients showed that they were more focused on wealth growth rather than wealth preservation, with much more risky asset allocations. This included the highest allocation to real estate, at 40.6% of assets.
Other stark differences between Australia and its Asia-Pacific counterparts were:
Australians prefer a single touch point over multiple experts
They would rather direct contact over digital contact
Australians showed a preference for real-time reporting