What drives a sense of financial wellbeing for High Net Worth individuals?
Many might wonder why this question is worth considering. But according to our latest research, it’s an area more High Net Worth professionals could use some assistance in. Not only does financial wellbeing go far beyond pounds and pence, but most High Net Worth individuals feel unable to achieve financial wellbeing in the areas that they consider most important.
We surveyed nearly 200 High Net Worth individuals on a range of issues around financial wellbeing. We asked what threatens it, what could support it and what the most important components of it are and how able they feel to achieve them. From that, we have been able to understand where High Net Worth individuals feel the biggest sense of shortfall in their ability to achieve financial wellbeing.
We found that the most important factors driving financial wellbeing are emotional:
- “Having wellbeing in other walks of life e.g. physical, mental”
- “Feeling happy with the state of my finances”
- “Having clarity and confidence over my future plans”
However, these emotional drivers are the factors High Net Worth individuals find hardest to achieve, compared to other factors such as, “providing financial support to family” or “reaching a desired level of wealth.”
Underscoring all these factors is a key finding: a lack of time to properly plan finances is the stone in the shoe. By this, we mean that time rarely feels like the most pressing issue to address at any given moment. But resolving it puts you in a better position to tackle other threats to financial wellbeing.
Out of the people we researched, the youngest and those at the lower end of the wealth scale are most affected. The time-scarce position these individuals find themselves in, and the sense that they’re affluent enough to deal with most financial problems, means they may feel spending time trying to achieve financial wellbeing isn’t the biggest priority.
So what’s the solution? There’s no quick fix. But when asked what support individuals would find most desirable, the types of support that can be provided by a financial adviser, such as setting objectives and cash flow forecasting – scored highest.
Not only can financial advice provide guidance and clarity, it can also help indirectly on the most important factor of all: achieving wellbeing in other areas (such as physical or mental health). For those in work who can’t dedicate the time to proper financial planning, professional advice can help. After all, if financial wellbeing goes beyond pounds and pence, many could do worse than to delegate those worries elsewhere – and focus on the elements that truly matter.
To download the full report, Financial Wellbeing: more than pounds and pence, click here.