There are approximately 211,275 UNHW individuals across the globe with net assets of more than $30 million, as documented by the Wealth-X and UBS World Ultra Wealth Report 2014, with a combined net worth of almost $30 trillion. That means 0.004 percent of the world’s adult population controls 13 percent of entire global wealth.
It’s also predicted that by 2019, the size of the global UHNW population will increase to more than 250,000 people, with a combined net worth of around $40 trillion. Here are the biggest myths about the global ultra wealthy, according to Wealth-X, a firm that specialises in data and intelligence surrounding ultra high net worth (UHNW) individuals.
Myth 1 – All ultra wealthy people inherited their fortunes
Entrepreneurship is one of the primary characteristics of the world’s UHNW population, according to the Wealth-X and UBS World Ultra Wealth Report 2014. The majority of UHNW individuals are self-made and are involved in founder-owned private businesses. Of the world’s 211,275 UHNW individuals, 63.8 percent (134,820 people) are self-made, while 17.4 percent (36,690 people) received their fortunes through inheritance and 18.8 percent (39,765 people) have a blend of self-made and inherited wealth.
Myth 2 – The ultra wealthy all graduated from Ivy League universities
Nearly 88 percent of UHNW individuals hold a bachelor’s degree, a possible reason for the popularity of higher education as a philanthropic cause among UHNW donors. However, this also indicates that 12 percent of the world’s UHNW population have not continued their education beyond high school, or dropped out in college, according to the Wealth-X and UBS World Ultra Wealth Report 2014.
Although certain universities are particularly popular among the ultra wealthy, the top 10 universities by UHNW alumni population account for just 5 percent of the world’s college educated UHNW individuals. Of the top 10 universities with ultra wealthy alumni, five are Ivy League (Harvard University, University of Pennsylvania, Columbia University, Yale University and Cornell University). The other universities in the top 10 are Stanford University, New York University, Massachusetts Institute of Technology, University of Chicago and Northwestern University.
Myth 3 – The ultra wealthy don’t give back
Global philanthropic giving among the world’s ultra wealthy totaled US$112 billion in 2014, equivalent to the GDP of Morocco, according to the Wealth-X and Arton Capital Philanthropy Report 2015. The typical UHNW philanthropist donates US$28.7 million in his or her lifetime, and 65 percent of UHNW individuals donate over US$1 million throughout their lifetimes. Based on absolute value of total donations, India has the most generous UHNW donors, followed by the United Kingdom and Hong Kong.
Based on donations as a percentage of net worth, the United Kingdom has the most generous donors, followed by the United States and Hong Kong. In addition, 1 in 28 UHNW individuals (or 7,441 people) have donated funds toward alleviating the global refugee crisis, for a total of US$2.7 billion.
Myth 4 – The ultra wealthy all own trophy properties around the world
Real estate accounts for 3 percent of billionaires’ net worth, equivalent to $94 million per individual, according to the Wealth-X and UBS Billionaire Census 2014. The typical billionaire owns four properties, each worth, on average, US$23.5 million. Although real estate is partially an investment, for billionaires it is also a necessity: considering their global lifestyle, having numerous residences around the world is essential.
UHNW individuals tend to own fewer homes than their wealthier billionaire counterparts. On average, UHNW individuals own 2.7 properties, and hold over 8 percent of their net worth in real estate assets. Female UHNW individuals tend to hold more of such assets, with an average holding of US$20 million in real estate, compared to US$14 million for their male counterparts. Of the world’s 211,000 ultra high net worth individuals, 79 percent own two or more residences; for the majority of these individuals, their primary and secondary homes are in the same country.