Kiwis' mean and median wealth per adult suffers annual fall, according to the Credit Suisse-UBS Global Wealth Report

A decline in New Zealanders' wealth was a standout in the annual UBS-Credit Suisse Global Wealth Report, partially reversing the previous year's significant increase.

Among the 60 countries with the highest wealth per adult in the report, NZ recorded the second biggest dollar value drop in both mean and median wealth.

NZ's mean wealth per adult for 2022 fell US$67,420 year-on-year to US$388,760, placing it sixth down from fifth. NZ's median wealth per adult for 2022 fell US$30,640 to US$193,060, placing the country fourth down from third. (See more in the tables and chart lower down this story).

Last year's report, featuring 2021 figures, noted the NZ dollar had appreciated 8.8% against the US dollar. This, along with "rapidly rising house prices" helped NZ's mean wealth per adult increase US$114,289, or 32%, to US$472,150. This year's report has NZ house prices down 9% in 2022.

The authors note 2022 recorded the first fall in net global household wealth since the Global Financial Crisis of 2008.

"Measured in current nominal US dollars, total net private wealth fell by US$11.3 trillion (–2.4%) to US$454.4 trillion at the end of the year. Wealth per adult also declined by US$3,198 (–3.6%) to reach US$84,718 per adult at end-2022," the report says.

"Much of this decline comes from the appreciation of the US dollar against many other currencies. If exchange rates are held constant at 2021 rates, then total wealth increased by 3.4% and wealth per adult by 2.2% during 2022. This is still the slowest increase of wealth at constant exchange rates since 2008. Keeping exchange rates constant but counting the effects of inflation results in a real wealth loss of –2.6% in 2022."

They also say overall wealth inequality fell a little in 2022, with the wealth share of the global top 1% falling to 44.5% from 45.6%. The number of US dollar millionaires worldwide fell by 3.5 million during 2022 to 59.4 million people. The authors say, however, this is before taking into account 4.4 million "inflation millionaires" who would no longer qualify if the millionaire threshold were adjusted for inflation in 2022.

"Global median wealth, arguably a more meaningful indicator of how the typical person is faring, did in fact rise by 3% in 2022 in contrast to the 3.6% fall in wealth per adult. For the world as a whole, median wealth has increased five-fold this century at roughly double the pace of wealth per adult, largely due to the rapid wealth growth in China."

The authors say according to their projections, global wealth will rise 38% over the next five years, reaching US$629 trillion by 2027. They say growth in middle-income countries will be the primary driver of global trends.

"We estimate wealth per adult to reach US$110,270 in 2027 and the number of millionaires to reach 86 million while the number of ultra-high-net-worth individuals is likely to rise to 372,000 individuals."

The 2023 edition is the fourteenth edition of the Global Wealth Report. Previously issued by Credit Suisse, it's now in the name of both Credit Suisse and UBS, following the acquisition of Credit Suisse by UBS. According to the authors, the report explores how wealth is created, how it varies across regions globally, and how it transforms, evolves, and migrates across generations.

Net worth or "wealth" is defined in the report as the value of financial assets plus real assets, primarily housing, owned by households, minus their debts. Private pension fund assets are included, but not entitlements to state pensions. Human capital is excluded, plus state-owned assets and debts. Valuations refer to year-end values and are usually expressed in terms of US dollars using end-of-period exchange rates.

UBS and Credit Suisse say the selection of countries in the report is heavily constrained by the availability of reliable data.

"For the most part, we confine attention to markets that have official balance sheet data. Most of these markets have reported figures for the total financial wealth and debts of households at the end of 2022, and often total non-financial wealth as well. Typically, the same markets have share price and house price series covering most, or all, of 2022, which helps to fill any gaps."

"Some markets do not meet our target standards. Brazil is one example. But it is difficult to review household wealth experiences in Latin America without reference to its largest economy. Even less is known about Nigeria. However, in the absence of an obvious alternative, we chose it to partner South Africa in order to give some idea of developments in Africa," the authors say.

"The paucity of data sources makes it difficult to review household wealth developments in the Middle East, North Africa region. However, given the importance of the region, we have used the available information to provide wealth estimates for Saudi Arabia and the United Arab Emirates which may help in understanding how the level and distribution of household wealth has evolved since the year 2000."

Total NZ wealth was estimated at US$1.4 trillion.

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