Wealthy Investors Attitudes on The Economy

11/2/2022

 The economy over the past year has been anything but ideal. Investors of all wealth levels have seen some significant asset value changes as a result of the economy and volatile stock market. Everyone, both financial professionals and investors, are hypothesizing how long this economic decline will stay. Investors not only have to worry about the economy, they must also worry about whether their household assets will decline, and the financial health of the company they work for.

Investors are fairly optimistic about their own household’s assets, according to recent research from Spectrem Group. Nearly half of investors feel their household assets will be the same over the next 12 months, while just over a third, 34 percent, feel their household assets will be higher and 19 percent feel it will be lower. Investors with a net worth between $5 million - $9.9 million are a bit more pessimistic, with a quarter of those investors feeling that their household assets will be lower in the next 12 months. Household assets are typically impacted by household income, and by extension, the health of the company that the investor works for.

The optimism continues when investors consider where their household income will be in a year. Sixty percent of investors feel their household income will be the same in a year as it is now. Thirty percent of investors feel that their household income will increase in the next 12 months. Investors with a net worth between $5 million - $9.9 million continue to be the most pessimistic, with 13 percent feeling that their household income will decrease over the next year.

Financial health of the company or organization an investor works for seems to be where investors feel the most strongly that things will stay the same. Seventy-one percent of investors feel that the financial health of the company they work for will be the same. Eighteen percent feel it will be better, and 11 percent feel it will be worse.

When it comes to the overall economy however, investors are quite a bit more pessimistic. Forty-five percent of investors feel that the economy will be worse over the next 12 months. A quarter feel the economy will be better, while 30 percent feel it will be the same. Having the economy be the same that it is currently is also a bleak picture. Investors with a net worth between $500,000 - $999,999 are the most pessimistic, with only 17 percent feeling that the economy will be better.

No one person is able to completely predict where the economy will be headed over the next year, which can impact employment, income, and assets. Investors should take the time to understand what is going on within the economy and work with their advisor to ensure they are fully prepared for whatever the economy will do in the future.