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Global Wealth Report finds millennials in financial fix

Although global wealth has grown substantially in the past decade, the so-called millennial generation is finding it harder to excel financially than previous generations due to greater inequality and joblessness.

In its Annual Global Wealth Report, the research arm of Swiss banking giant Credit Suisse has found that global wealth has expanded 27 percent in the past 10 years, but the spread is far from even.

In the United States, for example, about 90 percent of the children who were born in 1940 earned more than their parents. For the so-called millennials — individuals born in the 1980s and 1990s — this rate had fallen to 50 percent, the report said.

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Presenting the bank's findings in Zurich on Tuesday, Credit Suisse research chief Nannette Hechler-Fayd'herbe said the problem applied to millennials not only in the US, but also to those in Europe.

"They cannot be called a lucky generation," she said, adding that millennials were facing far more adverse market conditions than previous generations, which would "most likely limit their wealth acquiring prospects."

According to the report, they have been hit with direct losses from the global financial crisis. In addition, they're facing first-hand the subsequent unemployment crisis and increased income inequality, as well as suffer from higher property prices, tighter mortgage rules, and in some countries, a considerable rise in student debt.

"They are also set to experience less access to pensions than their predecessors," the report noted.

Moreover, only a few high achievers really stand to profit from their costly university education, the report warned. For others, a degree may only bring them "job opportunities and wages no better than those of their parents."

 

Young adults in China and other emerging economies had been faring relatively better than in Western countries, according to the research that is based on data about the wealth of 4.8 billion adults across some 200 countries.

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Wealth and inequality accelerating

The Global Wealth Report also shows that between mid-2016 and mid-2017, global wealth grew by 6.4 percent - its fastest pace in five years and allowing the mean wealth per adult to reach a record high.

It pointed to "widespread gains in equity markets", at the same time as non-financial assets like real-estate for the first time passed the level they were at when the global financial crisis struck in 2007.

"A decade since the start of the global financial crisis, we see a significant increase in wealth across all regions of the world," Credit Suisse chairman Urs Rohner said in a statement.

But while wealth grew worldwide, some obviously benefitted more than others. Today, less than 10 percent of the global population owns 86 percent of the global wealth. And since the year 2000, the number of millionaires globally has increased 170 percent, while the number of people with more than $30 million (€25.5 million) to their name has ballooned five-fold to around 45,000 worldwide.

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Geographically, the United States raked in most of the global wealth gains. US households alone added around $8.5 trillion to their combined coffers, half of the total world gain over the past 12 months. By comparison, China contributed $1.7 trillion to the global wealth gain.

Switzerland meanwhile remained the country with the highest average wealth per adult, with that number soaring 130 percent since the turn of the century to $537,600. Norway, Denmark, Belgium, Britain and France, also figure among the top countries in terms of wealth per adult.

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uhe/jd (AFP, dpa)

 

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