Strong equity and property investment markets helped to create 43,500 new Australian millionaires in 2014, according to the latest report about Australia’s high net worth individuals by analysts at Investments Trends.
Australia is now home to 443,500 individuals with investable assets worth more than $1 million.
But according to Investment Trends, membership of the millionaire club will continue to grow, with 580,000 Australians classed in the “emerging” high net worth group, owning between $500,000 and $1 million in investable assets.
Investment Trends analyst Irene Guiamatsia told SmartCompany the number of high net worth individuals in Australia has grown “consistently” over the past three years.
“Last year the population grew by 43,500. It was 30,000 the year before and 40,000 the year before that, so there has been a consistent upwards trend,” Guiamatsia says.
She says high net worth individuals typically hold around one third of their wealth in the sharemarket, with another third in property. The strong performance in both sectors last year is the primary reason in the swelling of the number of millionaires across the country.
But fellow Investment Trends analyst King Loong Choi told SmartCompany the growth in the value of self-managed super funds over the past six years is also boosting the country’s stock of high net wealth individuals.
“SMSFs have been growing strongly over recent years and high net worth individuals often hold their wealth in SMSFs,” he says.
The latest Investment Trends report also found the majority of high net worth individuals opt not to seek regular financial advice, with only around 40% of high net worth individuals seeking professional advice in 2014.
While the financial advice sector continues to come under pressure following scandals at some of the country’s largest banks, Guiamatsia says the decision by many high net worth individuals not to seek financial advice comes down to maintaining control over their investments.
“They will reject a proposition from a financial adviser unless they feel they are still in control,” she says.