A study by the wealth management organization shows that wealth brings certain freedoms but a large share of HNW and UHNW individuals aren't planning ahead.

The vast majority of US high-net-worth and ultra HNW individuals use the freedom that their wealth gives them to widen their activities, but almost half do not have a clear goal or plan in place, a study finds.

US Trust, part of Bank of America, quizzed almost 1,000 individuals and found that 90 per cent of them say wealth creates more choices, but 47 per cent do not have a clear purpose about what to do with their money and 49 per cent do not have a plan in place.

The study, 2018 US Trust Insights on Wealth and Worth, also found that HNW millennials – a cohort of the population attracting almost obsessive industry and media coverage – have become far more willing to shoulder equity risk, slashing cash allocations to 21 per cent of all portfolios from a previously reported share of 47 per cent, although they’re still more equity-shy than older groups. People in the Generation X cohort, born prior to millennials, have a 54 per cent stocks allocation, and Baby Boomers hold 56 per cent.

Millennials are more enthusiastic about alternative areas such as private equity as a source of return; 61 per cent of this group do not think that they can grab above-average returns by only holding stocks and bonds any longer.

The findings come at a time when wealth managers are keen to identify how well prepared people are for an expected $30 trillion shift in wealth to the next generation in the next few years. The rise of a supposedly more socially conscious, and in some ways more cautious, millennial cohort also sheds light on the current noise around private capital investment and environmental, social and governance tests in investment.

Among other findings, some 80 per cent of investors expect companies to not just be profitable but shoulder responsibility for how they affect the environment and society, and a growing share use ESG tests in making investments.

Away from the well-trodden ground of investment and wealth planning, the study also explored niche areas such as art investing/collecting. For example, the study identifies a “new breed of financially-driven art collectors”, with 78 per cent of all collectors planning to buy art, and 46 per cent intending to sell, this year.

At a time of heavy focus on women’s roles in work and financial management, the study found that women are now the equal or primary income earners in four out of 10 HNW couples, and 38 per cent overall, including 48 per cent of millennial women.