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How has COVID-19 impacted the wealthy?

Torie Bold EVP 09/14/2020

Almost six months in to the global pandemic, we take a look at how high net worth individuals (HNWIs) in the UK, US and China have been impacted by COVID-19

Even very wealthy individuals are feeling uncertain about what their finances will look like going into the future...

Toward the end of Q1’20, we used Savanta’s MillionaireVue (our HNW omnibus)  to ask more than 1,500* high net worth individuals across the three core wealth markets how they were responding to the initial impact of the coronavirus outbreak.

Now, with the release of data from MillionaireVue Q2’20, we take an in-depth look into how their behaviours and concerns have changed and adapted following a turbulent few months of uncertainty.

Though the figure has dropped slightly since Q1’20, COVID-19 is still the primary concern for almost seven in ten UK based HNWIs (down seven points to 68%). However, the number has increased among HNWIs in the USA, up 6 points to 75%, and has stayed the same in China (73%).

Each of the markets notes its second biggest cause for concern as an impending financial crisis/recession, though the level of worry is higher in the USA (62%) and China (62%) than in the UK (45%).

HNWIs are turning to financial advisers for guidance

The coronavirus pandemic has left many people with concerns about their income, business health and cash flow – even very wealthy individuals are feeling uncertain about what their finances will look like going into the future.

In fact, one of the top things that HNWIs state as an effect of the coronavirus pandemic is their decision to discuss their financial situation with a professional financial adviser. This has been particularly prevalent in China, where almost half (48%) have sought advice, though a significant amount have done so in the UK and the US too (23% and 27% respectively).

Perhaps as a result of their conversations (among other things), many have also reduced their spending on non-essential items, focussing on only buying the basics in order to level up on the crisis. A quarter (24%) of UK HNWIs have cut back on splashing the cash, along with 33% of those in the US and 32% of those in China.

What changes have been made to their working situations?

As like much of the rest of the population who are able to, almost half (48%) of HNWIs in the UK are working from home, along with 44% of those in the US and a quarter (25%) of those in China.

Some have had to take actions such as changing their business strategy, take a salary reduction and even close their business temporarily due to the pandemic.

Levels of worry

There appears to be a polarisation of views when it comes to how worried HNWIs are about COVID-19. In the UK, whilst half are very worried about it (49% scoring between 8-10 out of 10), more than one in five HNWIs claim to be far less concerned (scoring 0-5). In the US, more than half are very worried (55% scoring between 8-10) and in China 54% say the same. Though, similarly to the UK, there is a surprising number of millionaires in the latter countries who are far less concerned as well (between 0-5).

More than half of all HNWIs say that COVID-19 has made little difference to their health or financial security, however of those who have been affected in some way, it’s financial security and mental health that have suffered the biggest blows.

Savanta’s MillionaireVue is a quarterly omnibus with c. 500 HNWI’s in each of UK, US and China. A reduced wave was run in Q2’20, with c. 300 HNWIs interviewed in each market between 16-28 June 2020. For more information please click here.

* UK: GBP1m+, US/ CN: USD1m+