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Beyond Investments, Health Remains Top UHNW Concern – Julius Baer Study

Editorial Staff

9 November 2022

Health remained a top priority for ultra-high net worth families this year, having displaced regulation in the top-three biggest concerns in 2021 because of the pandemic, an annual study of views by shows.
In 2022, the top-three discussion topics “beyond investments” for families were unchanged from the previous year – family wealth (23 per cent), family governance (28 per cent), and health (17 per cent). The “other” category accounted for a total of 38 per cent. 

For the 2022 edition, the Zurich-listed bank asked more than 1,000 internal and external experts. The results appeared in its Family Barometer 2022.

Wealth-related topics include succession planning, wealth structuring and responsible wealth management such as sustainability. Within this category, which is once again the highest-ranked topic beyond wealth in this year’s Family Barometer, attitudes have moved. Until recently, sustainability considerations were often confined to specific investments or philanthropy. The experts surveyed report that families are “starting to take a more holistic approach towards sustainability and want their values reflected more widely across investment portfolios,” the authors of the report said. 

Experts consulted for this year’s report suggest that the need for cross-border planning extends into every aspect of family life. About one in two UHNW families have relations and/or physical assets in more than three continents.

In other findings, when asked what investment topic they expect to grow the most in importance in the next three to five years, “direct private investments” came joint top (15 per cent); “geopolitical diversification of assets” achieved the same result (15 per cent); “sustainable/responsible/impact investing” came next at 13 per cent; “digital assets” accounted for a score of 9 per cent and “investment in real estate” came in at 7 per cent.

Turning to investment topics, the experts reported a sharp increase in enquiries from families who want their assets to be more geographically diversified. Russia’s invasion of Ukraine was a “stark reminder of the risk of geographic concentration,” Julius Baer said.

Seeking advice
Elsewhere, the report noted that more families seek outside help to complement their existing advice networks. Legal matters, wealth management, and family governance were among the most common reasons for families to seek external advice.

“Despite the enduring popularity of referrals and personal introductions, the experts surveyed reported that more than half of families would likely get better results if they took a more structured approach when selecting outside expertise,” the report said. “Discussions with the survey participants suggest that the results from word-of-mouth searches can be hit or miss. While it isn’t uncommon to find relevant, high-quality external advisors by networking, there is a risk that families end up looking too close to home. A more rigorous, comprehensive search could be the difference between making a costly mistake and finding an appropriate expert solution that helps a family navigate their future safely.”

The study found that four out of 10 UHNW individuals have family members in three or more continents; 23 per cent of UHNW families put top priority on succession planning, philanthropy and wealth structuring, and 70 per cent of families lose a lot of their wealth by the second generation and 90 per lose it by the third generation.