US Wealthy Plan Spending Spree—Report

Stephen Harris

21 June 2005

America’s most wealthy are planning to spend more than usual on everything from jewellery and watches to luxury hotel stays and private yachts this summer, according to a survey by Elite Traveler magazine and Prince & Associates, a wealth management consultancy. Those with net worth of $10 million and above plan to spend more in nine of the 16 categories measured by the survey, while six categories showed spending in line with last year and only one category showed any decline. Among the categories seeing the biggest increase for spending for the America’s rich were yacht rentals where projected spending jumped from $266,000 to $317,000 and luxury hotels, resorts and spas which saw spending increase from $71,000 to $98,000. The amount the wealthy plan to spend on watches and jewellery over the summer increased from $55,000 to $63,000 while fashion accessories purchases (handbags, shoes) is projected to increase from $10,000 to $16,000. Redecorating jumped from $114,000 to $137,000 while out-of-home spa services increased to $49,000 from $41,000, charitable giving moved to $52,000 from $47,000 and summer entertaining increased from $34,000 to $39,000. Money spent on luxury cruises is expected to increase from $62,000 to $71,000. “This is very good news for the luxury segment of the economy,” said Douglas Gollan, editor of Elite Traveler magazine, in a statement. “For most high-luxury companies a small percentage of customers account for a large percentage of profits. This research shows that companies that depend on the trade of the uber wealthy will continue to see strong sales growth for the second half of the year.”