Average wealth in the UK has “fluctuated” around its peak before the financial crisis, a report has found.
The 63-page Credit Suisse paper, Global Wealth Report 2014, said the financial crash led to a fall in average wealth, but that this had been recovering.
It said: “Average wealth in pounds sterling fluctuated around the pre-crisis peak up to 2013, but last year rose 6 per cent above the 2007 level.
“In US dollar terms, however, wealth per adult remains below the 2007 figure.”
| UK population | 63m |
| UK adult population | 48m |
| UK gross domestic product | £33,445 an adult |
| UK mean wealth | £181,267 an adult |
| UK median wealth | £18,949 an adult |
| UK total wealth | £8.8trn |
| Number of dollar millionaires in the UK | 2,043,000 |
Source: Credit Suisse Global Wealth Report 2014
The report also found that levels of household debt, also at their highest point before the crash, had fluctuated.
It said: “Along with many other countries, household debt grew quickly as a multiple of income from 1980 onwards, tripling in value to reach 180 per cent in 2008.
“The debt-to-income ratio subsided to 150 per cent by 2013, but has subsequently risen back to 170 per cent.
“At 16 per cent of gross wealth, debt is not exceptionally high by international standards.”
The report added that the pattern of wealth distribution in the UK was “very typical for a developed economy”, with almost 60 per cent of the population having wealth of more than US$100,000 (£62,000).
The report, which analyses trends across different countries, noted that total global wealth “has grown to a new record, rising by US$20.1trn (£12.5trn) between mid-2013 and mid-2014, an increase of 8.3 per cent, to reach US$263trn (£163trn) – more than twice the US$117trn (£72.5trn) recorded for the year 2000”.
It added: “With an 11.4 per cent year-on-year increase, wealth creation was particularly strong in North America, where it now stands at US$91trn (£56.3trn), or 34.7 per cent of total wealth. Europe made the second-largest contribution, with wealth increasing 10.6 per cent to US$85.2trn (£52.8trn).”
The report found that China and the rest of Asia accounted for the largest portion of newly created wealth among the emerging markets, but added: “Emerging market wealth growth has not been able to maintain its momentum from the pre-crisis period between 2000 and 2008.
“This should not distract from the fact that personal wealth in India and China has risen by a factor of 3.1 and 4.6 since 2000.”
Adviser view
Paul Holiday, financial adviser for East Anglia-based Greensky Wealth, said: “Because it is so cheap to borrow, I think disposable income has risen. The problem is going to be when interest rates go up.”
