Capgemini and RBC Wealth Management released their World Wealth Report measuring the world's millionaires. The report said there were 920,000 new millionaires created in 2014, bringing the global total to 14.6 million[CNBC].
How many millionaires are there really?
It turns out, the numbers depend largely on definitions of "millionaire." Specifically, while some studies measure people, others measure households. And while some only count "investible assets" as wealth, others include homes.
Credit Suisse, for instance, says it defines millionaires as those with total wealth of $1 million or more. It says it measures both "financial" and "nonfinancial" wealth, in other words anyone with net assets of more than $1 million, i.e. your house, art collection and other assets.Capgemini, however, restricts its definition to those with more than $1 million in investible assets, which doesn't including primary residences. So if you have a house worth $1 million and an art collection worth $5 million, but investible assets of only $500,000, you don't make the cut. That results in a much lower count.
This is not to say the methodologies are faulty. It's just that we don't have much visibility into exactly how the results are derived. Like estimates of billionaire net worth, the studies are useful as general guidelines. But when it comes to estimating individual wealth, whether for millionaires or billionaires, no study or list can be exact.
This much we know for sure: The rich are not only getting richer, they're getting far more numerous.
- Don
No comments:
Post a Comment