TAX CUTS that favour the wealthy and a recovery in stock markets have led to a boom in the number of American millionaires.
In 2003 the millionaire count in the US and Canada outstripped Europe, Asia, Latin America and the Middle East put together.
US millionaires increased by 14 per cent in 2003 to stand at 2.3 million, according to the 2004 World Wealth Report by Merrill Lynch and Capgemini.
Americans’ success at increasing and protecting their wealth comes not only from external economic factors but also from their own sophistication in managing money, the report’s authors say.
“Many ultra-wealthy families are creating ‘100-year plans’ in which family members are treated as business divisions, and emphasis is put on corporate-inspired guidelines such as family mission statements, governance structures and guidelines for communication.”
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The wealth adviser comes to represent a family member, the authors explain, taking on the role of chief financial officer. The report considers people with more than $1 million (£546,000), excluding the value of their home, to be “high net worth individuals”.
The survey found, however, that seriously wealthy people in the US and Canada – those with investment assets above $30 million – now number 30,000.
The number of millionaires increased by 12 per cent in China and by 22 per cent in India.
Sofia Chappuis, manager of Capgemini Consulting and one of the report’s researchers, said that wealth creation was driven in all regions by gross domestic product, which was 9 per cent in China and 7 per cent in India.
In China, strong demand for consumer products from neighbouring countries and a strong performance on local stock markets helped.