Australian millionaires: Why we are not as rich as we look; About 59 per cent of our wealth is held in property, second only to Norway. In the US, it’s 38 per cent.

October 12, 2013 Leave a comment

Andrew Heathcote Rich Lists editor

Australian millionaires: Why we are not as rich as we look

Published 10 October 2013 11:49, Updated 11 October 2013 07:48

The average wealth per person in Australia is $426,222, according to a report by Credit Suisse on personal wealth. Photo: Louie Douvis

There was great excitement yesterday when investment bank Credit Suisse gave us some good news. Apparently, Australians are the richest people in the world. Credit Suisse’s new Global Wealth Report shows that Australia has the highest median wealth per adult for the third year in a row. According to the figures, there are 11 million Australians worth more than $232,489 and 1.1 million millionaires.While it may seem that there are plenty of people doing quite well for themselves, we shouldn’t get too excited. Unfortunately, the numbers aren’t quite as good as they first appear.

One of problems is that we appear to slipping down the global standings, albeit from a high starting point.

Growth in household wealth between 2000 and 2013 was very strong. The average annual rate is a whopping 13 per cent but when you consider that half of that is due to currency fluctuations the rise seems much less impressive.

The rise since 2007, when you apply constant exchange rates, is a much less impressive 3.3 per cent.

A large proportion of our personal wealth, by global standards, is held in property. Proponents of the view that we are entering a new housing bubble may find this somewhat concerning.

About 59 per cent of our wealth is held in property, second only to Norway. In the US, it’s 38 per cent.

Last year we had the highest average wealth per person but this year we are number two behind Switzerland.

The average wealth per person in Australia is $426,222 or put another way, the average Australian is worth just 0.18 per cent of the poorest person on theRich 200.

Credit Suisse’s numbers suggest that our ultra-wealthy remain the big winners. The data shows that Australians make-up 3.8 per cent of the richest 1 per cent of people internationally, despite having just 0.4 per cent of all adults throughout the world.

Filed under Macro Trends

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Kee Koon Boon (“KB”) is the co-founder and director of HERO Investment Management which provides specialized fund management and investment advisory services to the ARCHEA Asia HERO Innovators Fund (www.heroinnovator.com), the only Asian SMID-cap tech-focused fund in the industry. KB is an internationally featured investor rooted in the principles of value investing for over a decade as a fund manager and analyst in the Asian capital markets who started his career at a boutique hedge fund in Singapore where he was with the firm since 2002 and was also part of the core investment committee in significantly outperforming the index in the 10-year-plus-old flagship Asian fund. He was also the portfolio manager for Asia-Pacific equities at Korea’s largest mutual fund company. Prior to setting up the H.E.R.O. Innovators Fund, KB was the Chief Investment Officer & CEO of a Singapore Registered Fund Management Company (RFMC) where he is responsible for listed Asian equity investments. KB had taught accounting at the Singapore Management University (SMU) as a faculty member and also pioneered the 15-week course on Accounting Fraud in Asia as an official module at SMU. KB remains grateful and honored to be invited by Singapore’s financial regulator Monetary Authority of Singapore (MAS) to present to their top management team about implementing a world’s first fact-based forward-looking fraud detection framework to bring about benefits for the capital markets in Singapore and for the public and investment community. KB also served the community in sharing his insights in writing articles about value investing and corporate governance in the media that include Business Times, Straits Times, Jakarta Post, Manual of Ideas, Investopedia, TedXWallStreet. He had also presented in top investment, banking and finance conferences in America, Italy, Sydney, Cape Town, HK, China. He has trained CEOs, entrepreneurs, CFOs, management executives in business strategy & business model innovation in Singapore, HK and China.

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