The growing wealth of thousands of Australians is set to push them into millionaire status over the next five years, according to a new global report. This trend is largely driven by the nation’s housing boom and increasing returns on superannuation assets, an economist notes. However, the data also reveals a rise in wealth inequality.
The Global Wealth Report from Swiss bank UBS measured wealth growth in US dollars, based on 2023 data from 56 countries. It projects that roughly 400,000 Australians will become millionaires (in US dollars) by 2028, representing more than a 20 percent increase in the nation’s millionaires. Currently, there are 1.9 million millionaires in Australia.
In 2023, the average wealth of an Australian adult was $807,557 (US$546,184), with financial assets comprising less than half of gross wealth, and debt per adult at 17 percent. This wealth figure has grown by 138 percent over the 15 years from 2008, according to the UBS report. Notably, nine percent of this growth occurred in 2023 alone, following a global slump in wealth growth in 2022.
“Median wealth, however, only increased about half as much, suggesting that wealth in the lower brackets rose more slowly than in the higher ones,” the report stated.
Westpac economist Justin Smirk told that the proportion of financial assets within the gross wealth data indicated the sources and direction of wealth flow.
“If half is in financial assets, then the other half is in real assets—so, property,” he said. “That gives you a very good indication of who is holding that—it would be the older generations, which predominantly are the ones that have been in the property game for a long time and have paid off their mortgages. Net wealth is being driven predominantly by what has been happening in the property market here in Australia.”
Smirk also pointed out that the data partially reflects the beginning of baby boomer inheritances passing down to the next generation, a phenomenon known as vertical wealth transfer. However, he noted that these types of transfers are just starting.
“There is actually a bit of horizontal wealth transfer going on—10 or 15 percent—and that is usually seen with one partner dying and transferring that wealth across to the other, or people choosing to transfer wealth horizontally across for various financial reasons.”
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