|
Published by: Mintel International Group Ltd.
Published: Mar. 15, 2002 - 99 Pages
Table of Contents
Introduction And Abbreviations
The Mass Affluent And The New Investment Climate
To Turn To The IFA, Or To Trade Up To A Premium Bank Account?
Focusing On Choice
Definitions
Abbreviations
Executive Summary
Favourable Economic Conditions Lead To Greater Prosperity...
...But Difficult Investment Climate May Dissuade Many From Equity Investments
Internet Increasing The Numbers Of Self-Directed Investors
1.2 Million Enjoy An Income Of At Least £50,000
Figure 1: Product Ownership Among ABC1s, January 2002
Wealth Differentials Increasing
The Peak Of The Banking Pyramid
Advice Or Execution-Only?
Even Among The Affluent, Most Still Bank With A High Street Provider
High Earners Are Apparently Less Risk-Averse
'Hot Prospects' Tend To Be Young And Relatively Affluent
Figure 2: Investment Holdings Among Key Targets, January 2002
Much Depends On The Investment Climate
Market Factors
Changes Set Against A Background Of Increasing GDP...
Figure 3: Year-On-Year Changes In GDP, 1991-2006
...And A Corresponding Growth In Disposable Income
Figure 4: PDI, Savings And Expenditure, At Constant 1995 Prices, 1995-2005
Investors 'Burnt' By Tech Shares Are Wary Of Moving Back Into Equities
Figure 5: FTSE 100 Index, January 1998-December 2001
Falling Equity Yields Bring Charges Into Sharp Relief
Falling Interest Rates Hit Returns On Savings...
Figure 6: Bank Of England Base Rate, 1991-2002
...But Have Contributed To Increasing Property Values
Figure 7: Non-Mix Adjusted Average House Prices, 1991-2001
Cash Is Still King For The Consumer
Figure 8: Composition Of Household Financial Assets, 1995-2001
Property Constitutes One Third Of All Inheritances
Figure 9: Composition Of Estates Passing On Death, 1998/99
The Internet And Financial Information
Figure 10: Internet Penetration, 1999-2001
Low Levels Of Online Purchasing, But A Valuable Information Source
Figure 11: Use Of The Internet For Financial Purposes, May-November 2001
Potential For Self-Directed Investors To Bypass Mainstream Institutions
Market Size And Segmentation
One In 40 Have An Income Of At Least £50,000 A Year
Figure 12: Income Distribution Of Taxpayers, 2001/02
Who Are The High Earners?
Figure 13: Regional Distribution Of Higher Earners, 1999
Focusing On The ABC1s
Figure 14: Selected Financial Product Ownership Among ABC1s, January 2002
More Than A Quarter Of Estates Worth At Least £100,000
Figure 15: Estates Passing On Death, Assets By Range Of Estate, 1998/99
The Richest 5% Of The Population Are Worth An Average Of £462,000
Figure 16: Average Estimated Wealth Of Top 1%, 2% And 5% Of Individuals In The UK, 1997 And
1999
An Increasing Concentration Of Wealth
Figure 17: Concentration Of Wealth Among UK Adult Population, 1985-2000
Key Targets Worth Between £150,000 And £300,000
Figure 18: Breakdown Of Assets Held By Estates Valued Between £100,000 And £500,000, 1999
Liquidity Highest Among The More Affluent...
...As Is The Savings Rate
Figure 19: Average Weekly Household Expenditure, By Income Decile Group, 2000/01
The Supply Structure
The Core Banking Relationship
Figure 20: The Banking Pyramid
Inertia Is King In The Current Account Market...
...Presenting Challenges As Well As Benefits To Providers
Concerns Exist Over Impartiality...
...Leading To 'Best Of Breed' Offerings
The Cost Of Advice
Figure 21: The Advice Ladder
The Major Players In The Mass Affluent Sector
The Consumer
Who Are The Mass Affluent?
The Characteristics Of The Wealthy
Figure 22: Liquid Financial Assets, By Gender, Age And Income, October 2001
Most Of The Mass Affluent Are Still Working
Figure 23: Working Status Of The Mass Affluent, October 2001
Professionals Constitute The Bulk Of The Mass Affluent Sector
Figure 24: Most Recent Job Among The Mass Affluent, October 2001
HNW Individuals Happier To Invest In Equities Than The Mass Affluent
Figure 25: Likely Investment Choices In The Next Two Years, October 2001
The High Street Still Dominates The Core Banking Relationship...
Figure 26: Bank Account Ownership, October 2001
...But Private And Premium Bank Accounts Also Feature Heavily
Figure 27: Main Account Of Those With Multiple Bank Account Ownership, October 2001
The Overwhelming Majority Are Happy With Their Current Account Provider
Figure 28: Satisfaction With Main Current Account Provider, October 2001
Execution-Only Services Preferred By The Mass Affluent...
Figure 29: Approach To Managing Finances Among The Mass Affluent, October 2001
...But Advisory Services Still Have A Key Role To Play
The Extreme Ends Of The Scale
Can The Internet Be An Important Distribution Channel Among The Mass Affluent?
Figure 30: Use Of The Internet For Personal Finance Management Among The Mass Affluent,
Oct-01
Figure 31: Envisioned Future Use Of The Internet For Personal Finance Management Among The
Mass Affluent, October 2001
The IFA Is Still The Primary Source Of Advice Among The Affluent
Figure 32: Sources Of Advice When Investing £20,000, October 2001
Investors Look For A Second, And Even Third, Opinion
Worrying News For The Packaged Account Providers
Figure 33: Attraction Of Lifestyle Services As Part Of New Wealth Management Package Among The
Mass Affluent, October 2001
And Who Will Be The Key Targets For Providers?
A Profile Of The High Earners
Figure 34: A Profile Of The High Earners, January 2002
Product Ownership Higher Across The Board Among ABC1s...
Figure 35: Financial Product Ownership, By Age And Socio-Economic Group, January 2002
...And This Is Reflected In Ownership Levels Among The High Earners
Figure 36: Financial Product Ownership, By Income Group, January 2002
The 'Personal Touch' Is The Prime Attraction Of Premium Banking Services
Figure 37: Attitudes Towards Premium Banking Services, By Age And Socio-Economic Group,
Jan-02
Would A Shift In Focus Reap Dividends For The Mass Affluent Banks?
Do The Affluent Feel That They Have 'Outgrown' The Banks?
Figure 38: Attitudes Towards Premium Banking Services, By Income, January 2002
Younger ABC1s Number Highly Among The 'Hot Prospects'
Figure 39: Socio-Demographic Profile Of Key Targets For Premium Banking Services, January 2002
Hot Prospects Look For An Integrated Approach To Their Finances
Figure 40: Attitudes Towards Premium Banking Services, Among Key Targets, January 2002
High Levels Of Investment Ownership Among The Hot Prospects
Figure 41: Investment Owership Among Key Targets For Premium Banking Services, January 2002
What Are Investors Looking For From Their Advisers?
Figure 42: Important Factors Among Key Targets When Choosing Financial Products Or Advisers,
Jan-02
The Future
Mass Affluent Banks Will Continue To Struggle In The Current Investment Climate
Depolarisation To Have A Major Effect On The Market...
...Although The Exact Nature Of The Changes Are Impossible To Predict
Advice And Personal Contact Still The Key Issue For Many
Is It Simply A Matter Of Time?
Forecast
Figure 43: Penetration Of Hot Prospects, By Gender, Age, Socio-Economic Group And Lifestage,
Jan-02
Figure 44: Forecast Of The Number Of Hot Prospects, 2002-06
Appendix: Research Methodology
Index Of Reports
AbstractIt was only a few decades ago that an individual's socio-economic status could be summed up in one of three ways - working, middle or upper class. This is certainly no longer the case, with increased social mobility and the rise of the middle class leading to a blurring of divisions, and the formerly elitist City institutions seeing ex-public schoolboys working alongside market traders' sons. In this new environment, new ways of stratifying society have been required, and a plethora of new 'classes' have been defined, ranging from the famous 'Yuppies' and 'Sloane Rangers' of the 1980s to the Internet millionaires of the late 1990s.
One such group that has become increasingly important to financial services providers is the 'mass affluent'. The term is, as with many of these descriptions, somewhat nebulous, but generally refers to those who certainly are wealthy, yet are some way short of millionaire status. As regards value/wealth, most providers aiming at the mass affluent are talking in terms of those who have at least £50,000 in liquid assets, or who earn in excess of £60,000. However, some operations targeted at the mass affluent will accept those with as little as £10,000 to invest, while at the other end of the scale many so-called mass affluent organisations would also look towards those with £250,000 in liquid assets.
In practice, the mass affluent can be broadly defined as those with sufficient assets to justify the higher levels of service and advice offered by the more upmarket financial services providers, while falling short of the levels of wealth required by traditional private banks such as C Hoare & Co or Coutts. Target individuals range from comparatively young professionals - high-flying City traders or lawyers, say - to older consumers who have profited from astute investment and soaring property values.
Get Full Details About This Report >>
|
|
US: 800.298.5699
Int'l: +1.240.747.3093
|
|
|
