Millionaires’ three biggest financial regrets

31st May 2013

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High-net-worth individuals’ top financial regret is not having put in place a regularly reviewed personal financial plan earlier in life, according to the results of an international poll. The second biggest financial regret was not consistently scrutinising personal investments, and the third was taking on too much unnecessary debt, the survey reveals.

When the deVere Group, the world’s largest independent financial advisory organisation, asked a sample of its clients in Europe including the UK, Asia, Africa, the Middle East and the US who have investable assets of more than £1m (or the equivalent), “what is your number one financial regret?” 57 per cent said not devising a reviewable strategy for their personal finances sooner.

A further 18 per cent said they regretted not regularly assessing the performance of their investments, 13 per cent regretted accumulating unnecessary debt, and 12 per cent cited other regrets, including not saving enough to fund their children’s or grandchildren’s education or not having built a large enough estate to leave to their heirs.

Nigel Green, chief executive of the deVere Group, says: “The poll shows that the number one regret of high-net-worth individuals was not putting in place a robust plan for their personal finances which could be efficiently and regularly reviewed.  With more than half of those surveyed citing this as their overriding regret, it’s clear that wealthy individuals value highly the benefits and opportunities that long-term financial planning brings them and their families, and that they understand the importance of routinely reviewing those plans to ensure that they always remain ‘on track’ to reach their financial goals.

“The survey also highlights how high-net-worth individuals regret having not scrutinised their personal investments more thoroughly and regularly in the past.  This suggests that they have previously made some costly mistakes by not keeping a closer watch over their investments which can, of course, always go down as well as up – and very quickly, especially in times of increased volatility.

“The third biggest regret of high-net-worth individuals was accumulating unnecessary debt.  A lack of financial discipline, which often manifests itself into a ‘keeping up with the Joneses’-type mentality, is an enemy of wealth creation and those surveyed appear to now believe that this might have delayed them achieving their longer-term, more fundamental financial objectives.”

Green suggests that many of these concerns may well apply to middle income investors as well: “Whilst this survey focuses on high-net-worth individuals, I suspect that should the same poll of middle income earners be carried out, it would produce similar results.  As someone’s wealth empowers them and their families to live the life they want to live, I imagine that any financial regrets would be fairly consistent.”

Six hundred and fifty-nine deVere Group clients who have investable assets of more than £1 million (or equivalent of) took part in the poll.

19 thoughts on “Millionaires’ three biggest financial regrets”

  1. Forbin says:

    Hello Shaun,

    Seems asset bubbles are the only way the Western economies can grow… UK, Sweden last week and now Ireland.

    I do wonder if the West is going through its ” Stone Head ” phase.

    That will lead to a great mis-allocation of resources we’ve ever seen.

    the leaking of QE ?

    Forbin

    Popcorn, a front seat in the circle and a show that cannot be missed !

    1. Anonymous says:

      Forbin, FT today had an artilce on whether Ireland was blowing up another housing bubble or not (“Ireland house prices raise fears of a new bubble”):

      http://www.ft.com/cms/s/0/96d5b868-fc81-11e3-98b8-00144feab7de.html#ixzz36nmqrCoA

  2. Forbin says:

    in the meantime its seem Germany has hiccupped

    Forbin

    1. dutch says:

      http://soberlook.com/2014/07/merkel-goes-to-china-to-halt-german.html

      ‘Part of the answer has been softer than expected economic data out of
      Germany. The nation that had pulled the euro area out of its recession
      has been experiencing some headwinds. Germany’s recent expansion has
      been partially driven by exports – both to the Eurozone and to
      elsewhere. And while the nation’s domestic demand remains relatively
      strong (see German retail PMI), weakness in exports is beginning to show.’

      1. Jim M. says:

        “The nation that had pulled the euro area out of its recession
        has been experiencing some headwinds”

        Is that, I wonder, a fair reflection of how the people of Spain, Greece and Portugal view Germany?

        1. Anonymous says:

          Hi Jim M

          Yes that is an interesting sentence is it not? It manages to be both technically true and also a little misleading. It is a phrase for a single country which the Euro area is not.

    2. Anonymous says:

      Hi Forbin

      There was plenty of further food for thought in today’s industrial production data from Germany which was headlined as follows.

      “Production in May 2014 down a seasonally adjusted –1.8% on the previous month”

      Not inspiring and it was much worse than forecast/expected. It also means that the last 3 months have seen declines on the preceding month.

  3. JW says:

    Hi Shaun
    Just had a look back over your recent blogs, sorry for the late response
    1 France unemployment; there are no such things as German ‘mini-contracts’ or UK ‘zero-hour’ contracts in France. Although the Eurostat numbers are supposed to the harmonised, they are definitely not. They do not take into account part-time or ‘no-time’ employment satisfactorily.
    A further particular anomoly is that the German unemployment number is the TREND figure, not seasonally adjusted number because ‘its too volatile’. Now anyone familiar with X12 adjusted numbers knows that comparing a seasonally adjusted number with a trend number is apples and pears. At this time a trend number could be easily 4 to 5% below the equivalent seasonally adjusted number. Austria, Finland and Iceland numbers are also ‘trend’ numbers. No wonder they all seem low and stable!
    2 Sweden’s head of central bank got outvoted. He wanted to keep the emphasis on the ‘housing bubble’. But heavily influenced by the ex-deputy governor ( he of -ve interest rate fame, ex Princeton, chum of The Squid etc) , the vote went against him. Yellon, Carney et al are happy.
    3 Ireland’s GNP? As you say corporations ‘internal transfer pricing’ does little to put food on the table of the Irish. But in common with say Spain,Portugal, Greece ( and southern Italy) the serfs return to their ‘natural order’.

    1. Anonymous says:

      Hi JW

      All discussions about unemployment number manipulation remind me of the Yes Minister episode from 30 years ago where it was already assumed to be rife! How much of the gap between the French and German unemployment rates would you put down to the different systems?

      As to Sweden there are many similarities between the situation it is in and the UK and yet the fact that it cut interest-rates does not seem to have influenced views that we will raise them. Should the pound £ remain firm and the Euro area weaken it could be our future too.

      1. JW says:

        Hi Shaun
        I do not know what the equivalent trend number is for France. But I would hazard a guess that is substantially lower than the latest seasonally adjusted number. We know that the addition of ‘part-time/zero hour contract’ numbers to the UK headline number takes it into double figures. I think the mini-contracts in Germany will have similar effect.
        My gut feeling is that the average of the E27 at about 11% , is probably not far off being the number across most of Europe once the particular ‘anomolies’ are taken into account. Its also not far from the equivalent adjusted US number.
        The global effects are felt by all western economies, its not logical to believe any one country is doing that much ‘better’ than others. The 95-99% are battling with the same problems.
        Re ‘Sweden’ , I can’t see Carney falling out of step with Yellen.

  4. Paul C says:

    Shaun, always insightful.
    The drop to 12% unemployment would seem like an improvement but how do you include for the tens of thousands of young people that emigrated between 2007 and 2014. Do they show in the new counting methodology as “jobs debt” yet to be repaid? I suggest that the disappearance of youth provides a very helpful stimulus to the numbers. Maybe we could employ “pied pipers” across Europe (France, Spain & Greece), to tunefully lead all of the youth off to lands of opportunity. Then, the youth unemployment numbers would be immeasurably improved in all those countries and the economic prospects would also (by accounting alone) seem far better.
    Paul C.

    1. Jim M. says:

      “Maybe we could employ “pied pipers” across Europe (France, Spain &
      Greece), to tunefully lead all of the youth off to lands of opportunity.”

      That’s the spirit! :))

    2. Noo 2 Economics says:

      Is this true? that tens of thousands of young people have emigrated between 2007 and 2014?

      I am interested in where they went. Do you have numbers for each discrete year and their initial destinations?

        1. Noo 2 Economics says:

          Thanks for the reply Paul, the articles have been useful. It was interesting to note that immigrants have been leaving too although it seems that position is reversing now but the net number of emigrations according to the FT article is 120000 – still a reasonable number to push the unemployment rate up another 3%.

          Looks like they think the UK and EU are the places to be but maybe thats because of ease of entry rather than a hard headed economic analysis of each country. If I was young I’d have gone to Australia in 2009.

          1. James Brown says:

            I live in Perth and there are great many young Irish here. I have often wondered about the demographics of the Western world and how it attracts so little comment among economists. My whole family left the UK, with all our skills and money, but according to David Cameron we have been adequately replaced and net migration is satisfactory, we have not been missed. Wishful thinking methinks.

          2. Noo 2 Economics says:

            If you’ve got engineering skills then Cameron’s probably right – the British response is to simply close manufacturing facilities and transfer the operation abroad (Far East, maybe even Australia?) if they can’t find workers with necessary skills, perish the thought that they should actually arrange training and upskill the workforce!

            The things I like about Australia are:

            1. The weather
            2. The standard of living
            3. Abundance of natural resources and proximity to China – they will continue to be a main manufacturing hub for at least another 40 years sucking in resources and will prefer short supply lines a la Australia rather than long ones a la South America although of course they won’t put all their eggs in the Australian basket like any sensible investor.
            4. The Weather
            5. The weather

            and did I mention the weather?

  5. dutch says:

    ‘ If we exclude the effects of the non-domiciled companies in Ireland and
    look at GNP instead we see that this burden rises to more like 148%.’

    That’s a good point Shaun.Iirc the Irish were the first country to start touting for multinational tax avoiders.

    Is the position similar in the UK?

    1. Anonymous says:

      Hi Dutch

      No we have quite a different position in the UK to that of Ireland. There GDP exceeds GNP by around 17%.

      In the UK we use Gross National Income or GNI and this theoretically is the same as GNP. It was actually above UK GDP in 2011 and was only some 1.2% lower in 2013. So we deteriorating a little but still a long way from the Irish situation

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