New research finds that the UK’s high-earners are more likely to invest in property and high-value items than buy into the current NFT trend
High-earning Brits plan to steer clear of high-risk investments, such as non-fungible tokens (NFT) and cryptocurrency, and instead invest their money in perceived safer bets, such as property, according to new research.
The survey of 250 high-net worth individuals from law firm Moore Barlow discovered that personal wealth among UK adults that have assets worth more than £2m decreased during the pandemic by an average of £8,250, with close to half losing between £25k and £50k.
Those that saw an increase in asset wealth (39 per cent) were far likelier to invest in property (46 per cent) or high-value items (21 per cent) – including art, wine and jewellery – than in higher risk, higher reward propositions such as NFTs (15 per cent) or cryptocurrency (12 per cent).
This is despite the global market for NFTs hitting £16.5bn by the end of 2021 and major international brands such as Coca Cola and Boohoo, and celebrities including Eminem, Jimmy Fallon and Wayne Rooney creating them.
Despite wanting to be sensible with their money, the survey also discovered that a significant number of wealthy adults haven’t put thought into estate and succession planning. More than a third (37 per cent) of over 45s said they didn’t have a Will in place. Of the remainder that had a Will, the vast majority (80 per cent) hadn’t updated it in at least five years.
Alex Milton, partner in the wills, trusts and estates team at Moore Barlow, said: “Contrary to popular belief, a lot of wealthy individuals did lose money during the pandemic, whether due to challenging conditions for the businesses they own, a much less lucrative environment for investing or job losses. It’s understandable that, with less money to burn, people are being more cautious about where they put their cash.
“The fact that high-earners are playing it safe with their money makes it all the more surprising that so many are yet to start the process of structuring their estates. Those investing in property should take into consideration how much more complicated these types of static assets make wealth management and succession planning. They aren’t easily divisible between beneficiaries which makes drawing up Wills or starting family trusts much more complex.”