Knight Frank Wealth Report 2016

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It’s become apparent that the world of the wealthy is changing: women and children are becoming more active in managing family wealth, children are encouraged to get involved in family business and it is more likely that family wealth created by the first generation will be lost or dissipated by the second.

Findings in the Knight Frank Wealth Report 2016, launched in South Africa in partnership with Standard Bank Wealth and Investment, takes a look at the world’s ultra-high-net-worth individuals (UHNWI). 

As a continent Africa cemented itself as an investment location as the report draws attention to the fact that in 2015 African UHNWIs held assets in excess of US$200bn. On the flip-side of the coin, however, African respondents to the survey were cautious of growth over the next ten years with 59% of them saying that wealth creation will slow to 2025. With that said it has to be highlighted that despite the global financial crisis UHNWI numbers grew sharply over the past decade, with Africa increasing 64% and moreover the rate of growth in emerging economies was higher than the rest of the world.

The report noted that African respondents said a large part of their concern about passing on wealth to the next generation stems from the fear that their children won’t be encouraged to make their own wealth. They fear that they will be ill-prepared to handle their money effectively and won’t even know what to do with their investments.

There is no doubt that the solution to preserving and growing wealth hinges on inter-generational communication and education. As part of their on-going involvement in education Standard Bank Wealth and Investment has created Wealth and Investment Leadership Academies aimed at the younger generation and spouses wishing to increase their knowledge and understanding of the world of finance and investment. The focus is simple; they are aimed at equipping families with the skills and financial awareness to help them develop and manage wealth in the future.

Just as important as preserving wealth it has become apparent the responsible use of wealth for philanthropic causes. 67% of financial respondents indicated that their clients’ philanthropic activities had increased over the past decade. Not only are the wealthy giving more, but the way that they are giving is changing – instead of creating charitable foundations, the emphasis has shifted to people creating more flexible limited liability companies to oversee their endeavours. This change has been primarily born from the desire to see that programmes are truly effective and address the social and environmental problems of our time.

For more insights into the trends of the wealthy across the globe, click here to take a look at the Knight Frank Report.