Wednesday, May 6, 2009

Personal saving rate is rising; the wealthy are rebuilding wealth....

CNNMoney comments on the results of a Fidelity study suggesting that "millionaires" are taking action to rebuild their wealth. From CNNMoney:
Who wants to be a millionaire when nearly half of them don't even feel rich, according to a survey released Wednesday.

Some 46% of the 1,012 participants in the annual Fidelity Investments study said they "do not feel wealthy and are taking action to reassess and rebuild their wealth."

That's a big change from last year, when only 19% said they didn't feel rich. Fidelity blamed the drop on the corresponding plunge in wealth, with an average 19% reduction in household income and investable assets, and a 28% plunge in real estate holdings.

Fidelity, a Boston-based financial services company, described the average respondent as having $3.5 million in assets and $306,000 in annual household income.

The millionaires reported various ways in which they're adjusting portfolios amid the recession. The bearish types are dumping more of their money into fixed-income securities, while the bulls are buying more stocks, according to Fidelity.

Millionaires feel less "rich" (a.k.a., wealth effect), and the personal saving rate surges. Ahem, they are consuming less, too.

Rebecca Wilder


  1. With all the bad and depressing stuff caused by the recession, this kind of news/statistics is very reassuring. Money isn't everything, but for the rich to say they don't feel that way is saddening. So for them to do something about it is inspiring--why don't we ALL do something to make us all feel (and possibly BE) millionaires?

  2. it's a pretty sad portrait of human nature isn't it, that someone with over $1 million in assets doesn't feel wealthy?! it's understandable though because we all make the same mistake - whether we are making $30K or $300K per year we adjust our expenses accordingly. it's not like the $1M in net worth is lying around in cash, it is only numbers on a piece of paper. if we could liquidate everything and get out of the rat race maybe then it would feel real, but once you get used to the nice trimmings in life it's hard to go back! i'm not saying it's right or wrong, merely believable is all...