2021 Outlook – What Are the Wealthy Focusing On

Despite weathering the Covid-19 recession financially better than society at large, high-net-worth-individuals (HNWI) are not unscathed. Their wealth is mostly unaffected, with stock markets quickly recovering to start of the year levels. Most believe that the recession will only temporarily affect their overall wealth, which will start growing again after the situation stabilizes. Yet our data clearly shows that the Covid-19 crisis has left a profound impression, changing their investment behavior and attitude to risk. We believe that this new mindset will have a long lasting effect on their vision of the future and on how they invest their wealth.

Here are 5 key insights from our latest study The AFFLUENTIAL™ Wealth Report 2020/21:

In these times of turmoil, they look for stability and liquidity. When we asked them where they invest their wealth post Covid-19, we were surprised to see that a large share of their wealth is now in cash, with almost 40% in Hong Kong. Steady capital growth and steady income flow are the two top financial goals for this segment, showing a decreased appetite for risky investments.
When we asked them how financially savvy they are, ~60% told us that they would rather get professional advice when investing. 3 out of 4, and up to 80% in Singapore, told us that they work with a financial advisor, another indication that they feel professional advice is essential to achieve their financial goals.
~80% have a retirement plan in place. Yet, we were surprised to hear that a large majority of respondents, 51% and 39% in HK and SG, say they are worried that their retirement plans are not enough to meet their financial needs when they retire. In addition to financial worries, the Covid-19 has increased concerns about their own and their family health and about the long-term financial security of their children. In some markets, for example Hong Kong, this is compounded with worries about the long-term future of the city. The overall picture is one of apprehension and uncertainty, driving them to be more conscious when investing their wealth.
Over 90% are familiar with the concept of “socially responsible investing”, defined as an investment strategy which seeks to consider both financial return and social/environmental good to bring about social change regarded as positive by proponents. The high % shows how Asian HNWIs are now very much conscious of the impact their investment and wealth have on the broad society and want to make a positive contribution when investing their wealth. As a result, ~60% of our sample respondents investigate companies’ CSR practices before investing in them.
A surprisingly high number of respondents indicated that they are looking for a new banking, wealth management and insurance relationship in the next 6 to 12 months. When asked what are the most important criteria when evaluating a new financial service provider, honesty in promoting their financial products ranked top in all markets surveyed. A perception that the provider understands their needs and an attentive and proactive service followed 2nd and 3rd. 
The AFFLUENTIAL™ Wealth Report 

The AFFLUENTIAL™ Wealth Report 2020/21 is an industry leading report which analyses the financial needs of HNW and UHNW individuals in Asia, designed to study how the financial behavior of the HNW & UHNW individuals across key Asian and global markets has changed post Covid-19. Our teams have completed interviews with over 3,600 HNWIs and UHNWIs across key markets in August 2020. Key insights from The AFFLUENTIAL™ Wealth Report 2020/21 will provide wealth management, banks, insurance, credit cards and other financial brands data and insights on wealthy individuals and how has wealth evolved during this pandemic, helping brands shape their strategy to win share of wallet in a hyper competitive environment.

Our Recent Events And Updates
  • Join us on the 20th September at the French Chambers in Asia roundtable, where Agility’s Managing Director, Amrita Banta, will share the latest data and insights on how Asian affluent consumers are changing their travel, consumption and lifestyle habits post Covid-19, together with senior executives of global leading luxury brands. Please check here to find out more information.
  • We will hold an exclusive online session to share our latest data and insights on the 2021 outlook for luxury sector. Date and Timing: 5th November; 5PM – Singapore/Shanghai/Hong Kong Time, 10:00AM – Paris/Milan/Geneva Time, 9:00AM – London Time.
  • Last week Agility’s managing director, Amrita Banta, shared at the Singapore Management University and LVMH 2020 Luxury Seminar Series the latest post Covid-19 data and insights on Asian affluent consumers’ luxury preferences and behavior, insights gathered from interviews with over 4,600 affluent consumers in key markets. Over 300 professionals working across different luxury sectors in APAC attended the well-received event.
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