Hong Kong's affluent citizens typically achieve millionaire status by the age of 33 and aspire to accumulate HKD10 million ($1.28 million) in liquid assets by the age of 62, according to the HSBC Premier 2023 Affluent Survey released on Tuesday. The first million is often accumulated through salary savings, accounting for 61% of the total, while trading investment products (21%) and fixed assets (14%) commonly contribute towards reaching the HKD10 million goal.
Despite the ambition, macroeconomic challenges present considerable obstacles. A significant portion of respondents anticipate a home price correction and do not foresee economic improvement within the next year. This has led to a decline in the view of property as a wealth preservation tool, with only half of the respondents endorsing it due to recent weakness in the real estate market.
In spite of these challenges, some individuals have managed to reach the HKD10 million milestone earlier than expected. Around 6% of respondents reported achieving this financial goal by age 45, adopting an aggressive investment approach that involves placing 70% of their cash in financial assets. This contrasts with other respondents who prefer to keep over 40% of their wealth in risk-free deposits.
The survey also highlighted trends in wealth succession and family assistance with property purchases. An average of HKD1.93 million ($248,000) is planned by parents to subsidize their children's home purchases. Moreover, 54% of respondents include grandchildren in their wealth succession plans, although only 25% have initiated these plans.
HSBC emphasized early planning, regular saving, disciplined investing and diversification as crucial strategies for wealth accumulation. It underscored the importance of family-based services addressing health protection, education, and cross-generation wealth transfer.
The survey indicates that despite the anticipated macroeconomic challenges and property market correction, Hong Kong's affluent remain proactive in their wealth accumulation and succession planning efforts.
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