Global Wealth ReportCorona slows private wealth growth

Within 20 years, the global number of millionaires has grown to 24 million people. Most of them are from the United Statesimago images / Levine-Roberts

Global private wealth totaled $ 226.4 trillion at the end of 2019, according to the “Global Wealth Report 2020” by the consulting firm Boston Consulting Group. Millionaires accounted for more than half of this amount. As a result, 24 million people worldwide had private wealth of at least $ 1 million last year. Until the Corona crisis, all signs were pointing to growth for her and her wealth: Since 1999, the number of millionaires and global private wealth have tripled.

The burst dotcom bubble and the financial crisis have not changed that much. “Despite several crises, wealth growth was robust,” says Anna Zakrzewski, BCG partner and author of the study. The main reason for the years of buoyancy was the positive development on the capital markets. The past year was particularly steep. In 2019, global private wealth grew 9.6 percent in constant currency. The last rise in this form occurred 15 years ago – before the financial crisis.

In its “Global Wealth Report”, BCG has been examining the development of global private wealth for 20 years. The analysis takes 97 markets into account. Private assets include stocks, funds, bonds, bank accounts and life insurance.

Wealth in Germany is growing moderately

In Germany, private wealth rose by 6.4 percent compared to the previous year. With a total value of $ 7.7 trillion, the Federal Republic is fifth in the world behind the United States ($ 94.2 trillion), China ($ 23.8 trillion), Japan ($ 17.6 trillion) Dollars) and the United Kingdom ($ 9.7 trillion). “On the one hand, the increase is due to the strong development of the Dax,” says Zakrzewski. “On the other hand, to the successful economic year 2019 with an increase in gross domestic product for the tenth time in a row.”

In comparison to the USA, however, the growth in private wealth was rather moderate. Assets have also grown significantly in emerging markets in recent years. In 2019, emerging economies account for around a quarter of global private wealth – almost half of it in China.

Conservative investments could be beneficial in Corona times

The moderate wealth growth in Germany is also related to the investment strategy in Germany. 40 percent of German private assets consist of savings and cash. That is a tenth more than the average in Western Europe. “In 2019, Germans missed a good chance of increasing their wealth. In times of Corona, where higher market volatility can be expected, conservative investment behavior can also be an advantage, ”said Zakrzweksi.

Although private wealth continues to grow even after the Corona crisis, the pandemic has so far given the upward trend a significant damper. Worldwide, the report anticipates global wealth growth of 4.5 percent in the best and 1.4 percent in the worst case. The pandemic is slowing growth in private wealth as strongly as it did eleven years ago.

In Germany, wealth could grow 2.5 to 4.2 percent and grow to a total value of between 8.8 and 9.5 trillion US dollars. For comparison: forecasts in 2019 still expected global wealth growth of 5.7 percent per year and 4.6 percent in Germany.

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