Zurich, Switzerland – The latest Global Wealth Report predicts global wealth to reach $629 trillion by 2027, despite 2022 being the first year of wealth decline since 2008, the fourteenth edition of the Global Wealth Report jointly launched on Tuesday by Credit Suisse and UBS revealed.
According to the report’s projections, growth by middle-income markets will be the primary driver of global trends. The report estimates wealth per adult to reach $110,270 in 2027 and the number of millionaires to reach 86 million while the number of ultra-high-net-worth individuals (UHNWIs) is likely to rise to 372,000 individuals.
The report shows that measured in current nominal USD, total net private wealth fell by $11.3 trillion (–2.4%) to $454.4 trillion at the end of 2022. Wealth per adult also declined by $3,198 (–3.6%) to reach $84,718 per adult. Much of this decline comes from the appreciation of the US dollar against many other currencies. Financial assets contributed most to wealth declines in 2022 while non-financial assets (mostly real estate) stayed resilient, despite rapidly rising interest rates.
Regional and demographic themes • Regionally, the report shows the loss of global wealth was heavily concentrated in wealthier regions such as North America and Europe, which together shed $10.9 trillion. • Asia Pacific recorded losses of $2.1 trillion. • Latin America is the outlier with a total wealth increase of $2.4 trillion, helped by an average 6% currency appreciation against the US dollar. • Heading the list of losses in market terms in 2022 is the United States, followed by Japan, China, Canada and Australia. • The largest wealth increases at the other end were recorded for Russia, Mexico, India and Brazil. • In terms of wealth per adult, Switzerland continues to top the list followed by the USA, Hong Kong SAR, Australia and Denmark despite sizeable reductions in mean wealth versus 2021. • Ranking markets by median wealth puts Belgium in the lead followed by Australia, Hong Kong SAR, New Zealand and Denmark.
When looked at in demographic terms, Generation X and Millennials continued to do relatively well in 2022 in the USA and Canada but were not immune to the overall wealth reduction. Broken down by race, non-Hispanic Caucasians in the USA saw their wealth decrease in 2022, while African-Americans were left almost unscathed by the downturn. In contrast, Hispanics achieved 9.5% growth in 2022, owing to their greater holdings of housing assets compared to financial assets.
Reduction in wealth inequalities
Along with the decline in aggregate wealth, overall wealth inequality also fell in 2022, with the wealth share of the global top 1% falling to 44.5%. The number of USD millionaires worldwide fell by 3.5 million during 2022 to 59.4 million. This figure does not, however, take into account 4.4 million “inflation millionaires” who would no longer qualify if the millionaire threshold were adjusted for inflation in 2022.
Global median wealth, arguably a more meaningful indicator of how the typical person is faring, did in fact increase by 3% in 2022 in contrast to the 3.6% fall in wealth per adult. For the world as a whole, median wealth has increased five-fold this century at roughly double the pace of wealth per adult, largely due to the rapid wealth growth in China.
The Global Wealth Report is one of the most comprehensive analyses of global household wealth available. The report has been issued by the Credit Suisse Research Institute, the bank’s in-house think tank, underpinned by the unique insights of the leading academics in the field, Prof. Anthony Shorrocks, Prof. James Davies, Prof. Rodrigo Lluberas and Prof. Daniel Waldenström.