Last year, 0.003 per cent of the world's population held, in assets, the equivalent of almost 38 per cent of global gross domestic product.
The global ultra high net worth (UHNW) population - made up of individuals with a net worth of US$30 million (S$38 million) or more - grew to 199,235 individuals last year, with a combined wealth of US$27.77 trillion. In other words, 0.003 per cent of the world's population holds, in assets, the equivalent of almost 38 per cent of global gross domestic product last year.
The importance and influence of the world's UHNW individuals is increasing across various industries - from wealth management to luxury, as well as philanthropy, among others.
While many firms, brands and non-profit organisations specifically target UHNW individuals, little research on this population had been undertaken until recently. Here are eight common myths about the uber wealthy:
1. The world's wealthiest inherited all their money
This is a misconception. Sixty-five per cent of the world's UHNW individuals are self-made, with a further 16 per cent having only partly inherited their wealth before going off to make their own fortunes. In other words, only 19 per cent of the world's UHNW population have fully inherited their wealth.
In terms of fortunes, we also see that UHNW individuals with inherited wealth also have the lowest average net worth of US$130 million, as opposed to US$142 million for self-made UHNW individuals. Even for the world's 2,170 billionaires, 60 per cent have made their fortunes themselves, with a further 20 per cent classified as a mix of self-made and inherited wealth.
2. The majority of super wealthy are investment bankers
While it is true that the finance, banking & investment industry is the single largest category from which UHNW individuals have derived their wealth, it is far from the predominant sector for the UHNW population.
At the moment, 19 per cent of the world's UHNW pool is primarily engaged in that industry - meaning that the majority are not. This broad industry accounts for all categories of finance: investment banking to hedge funds, private equity, venture capital, etc. So this is a misconception.
3. Technopreneurs are all hoody-wearing college dropouts in their 20s
While this certainly is the popular image of the start-up technopreneur who has struck it big, the average age for an UHNW individual from the technology industry is 54, and many of these people are highly educated.
In fact, the technology industry accounts for only 4 per cent of the world's wealthiest, a surprisingly small contribution given the media blitz this segment of the UHNW population has received.
4. I have to go to an Ivy League university to be an UHNW individual
Although Harvard tops the rankings of the school with the most UHNW alumni, Harvard graduates account for only a small portion of the world's UHNW population.
It is also worth noting that although the universities with the largest UHNW alumni population are from the Ivy League - specifically, six of the top ten global universities (by number of UHNW alumni) are Ivy League colleges - their combined UHNW alumni population is under 7,000 individuals, or 3.5 per cent of the world's total UHNW population.
Furthermore, more than 27,000 UHNW individuals, or 13.6 per cent of the global total, do not have higher education at all.