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Lifestyles of Affluent and High Net Worth Consumers - US - December 2016

Published By :

Mintel

Published Date : Dec 2016

Category :

Lifestyle

No. of Pages : N/A

US Affluent and HNWIs, with their large amount of income-producing assets, are important to lifestyle brands, particularly those offering value-added products and services. With higher-than-average household incomes, they command a significant amount of purchasing power across a variety of areas, from in-home food to household care to leisure and travel. Their earnings also afford them the ability to participate in a variety of upscale activities. In the next year, they aspire to travel more, better manage their health and wellness, and prioritize long-term wealth and financial planning. However, confidence in financial decisions wavers depending on a person’s age and gender.

Table of Contents

OVERVIEW
What you need to know
Definition

EXECUTIVE SUMMARY
The issues
Affluent/HNW women are less confident about financial decisions
Figure 1: Attitudes about finances and success, by gender, August 2016
Older Affluent/HNWIs not as interested in luxury travel
Figure 2: Activities done in the last 12 months – Travel, by generation, August 2016
One in five Affluent/HNW Hispanics’ finances are just “OK”
Figure 3: Current personal financial situation, by Hispanic origin, August 2016
The opportunities
Affluent/HNW Millennials are less aware of their finances and take more risks
Figure 4: Spending habits, by Millennials versus non-Millennials, August 2016
Women express increased interest in their finances
Figure 5: Financial goals – In one to five years, by gender and age, August 2016
Parents want to ensure their children have a financially secure future
Figure 6: Financial goals for the next 12 months, by parent status, August 2016
Nearly half of Affluent/HNW Millennials want a second home in the next five years
Figure 7: Financial goal – Buy a second home, by generation, August 2016
What it means

THE MARKET – WHAT YOU NEED TO KNOW
Households with $500K+ in investable assets continue to rise
The rich getting richer
Median household incomes are up
Affluent and HNWIs stand apart from the average American

MARKET SIZE AND FORECAST
America’s wealthiest continue growing
Figure 8: Number of US households with $500K+ in income-producing assets, 2011-16 (forecast)
Figure 9: Fan chart forecast number of US households with income-producing assets of $500K+, 2011-21

MARKET PERSPECTIVE
Minority of the population owns majority of nation’s wealth
Figure 10: Holdings of family wealth, by wealth group, 1989-2013
Top 10% are getting wealthier
Figure 11: Average wealth for families in the top 10 percent of the wealth distribution, 1989-2013

MARKET FACTORS
Median household income increases, finally
Figure 12: Median US household income, 2004-15
More people earning high incomes
Figure 13: Individuals aged 15+ with annual income of $150K+, 2006-15
Decade-high Dow is important to investing Affluent and HNWIs

AFFLUENT AND HNWI DEMOGRAPHICS
Affluent and HNWI – Not like the average adult
What defines them
Who they are
Figure 14: Affluent and HNWI – Finances, demographics, employment/location, August 2016
Figure 15: Affluent and HNWI – Key characteristics, index to all, August 2016

KEY PLAYERS – WHAT YOU NEED TO KNOW
Affluent/HNWIs can afford to pay for convenience
Faulty technology upgrades may delay adoption of new products
Unique luxury accommodations and activities appeal to Affluent/HNWIs

WHAT’S WORKING?
Convenience
Boss on Demand
Meal kits
Figure 16: Blue Apron email ad, October 2016
Luxury travel
United Airlines unveils luxury business class
Figure 17: United Introducing Polaris International Business Class, June 2016
Delta Private Jets and Porsche partner for smooth travel
Mind, body, and soul workouts
Peloton
Figure 18: Peloton Commercial: This is Peloton/Commercial, May 2016
Exhale Mind & Body Spa
Equinox

WHAT’S WORRYING?
The latest and greatest may not be all that great
Samsung Galaxy Note 7
Beats Pill XL Speaker
Tesla Model S self-driving mode
In the technology age, identity theft is a concern for Affluent/HNWIs

WHAT’S NEXT?
HENRYs
Luxury brands are capitalizing on hotel opportunities
Shinola
Aston Martin
West Elm
Sharing economy for the wealthy
Accommodations
Ride sharing
Boat sharing
Unique travel opportunities
Hotel meet hostel
Cuba

THE CONSUMER – WHAT YOU NEED TO KNOW
85% have participated in luxury activities or used luxury services
They’re wealthy but still appreciate a good deal
Health and work/life balance goals are most important
Attitudes about finances depend on demographics
Wealthy may need guidance with financial planning
Young adults aim to take control of their finances in next 12 months
Women and Millennials have specific goals for next five years
For some, more money equals more problems

ACTIVITIES DONE IN THE LAST 12 MONTHS
Dining out and cultural events are most popular activities
Figure 19: Activities done in the last 12 months, September 2014/August 2016
HNWIs more likely to be politically active, support charities, buy art
Figure 20: Activities done in the last 12 months, by Affluent and HNWIs, August 2016
Millennials are traveling in luxury
Figure 21: Activities done in the last 12 months, by generation, August 2016
Household income is a determinant for luxury activity participation
Figure 22: Number of activities done in the last 12 months, by household income, August 2016
Hispanics more likely to splurge on art and sporting events
Figure 23: Activities done in the last 12 months, by Hispanic origin, August 2016

SPENDING HABITS
Affluent and HNWIs are knowledgeable deal seekers, less brand loyal
Money management
Brand loyalty
Discretionary spending
Figure 24: Spending habits, August 2016
Millennials are less aware of their finances and are riskier spenders
Figure 25: Spending habits, by Millennials versus non-Millennials, August 2016
Suburban and rural Affluent/HNWIs are most price conscious
Figure 26: Spending habits, by area of residence, August 2016
Hispanics more willing to make high-risk investments, persuaded by social media
Figure 27: Spending habits, by Hispanic versus non-Hispanic, August 2016

GOALS FOR THE NEXT 12 MONTHS
Health and travel are top priorities in the coming year
Health and diet
Home improvement
Getting out of the house
Financial management
Figure 28: Personal goals for the next 12 months, August 2016
Millennials are likely struggling with maintaining a balanced lifestyle
Figure 29: Personal goals for the next 12 months, by generation, August 2016
Higher household incomes more in need of personal life overhaul
Figure 30: Personal goals for the next 12 months, by household income, August 2016
Hispanics are looking for more control in their lives
Figure 31: Personal goals for the next 12 months, by Hispanic versus non-Hispanic, August 2016

ATTITUDES ABOUT FINANCES AND SUCCESS
Affluent and HNWIs see themselves as confident and successful
Figure 32: Attitudes about finances and success, August 2016
Men are more confident about their financial decisions
Figure 33: Attitudes about finances and success, by gender, August 2016
Millennials are passionate and happy with their professional lives
Figure 34: Attitudes about finances and success, by generation, August 2016
Higher household incomes feel most influential, successful
Figure 35: Attitudes about finances and success, by household income, August 2016

FINANCIAL GOALS
Affluent and HNWIs are savvy financial planners, but may not prioritize the long-term
Figure 36: Financial goals achieved, by household net worth, August 2016
Short-term financial goals
Financial planning is a priority for Affluent/HNW Millennials in the next year
Figure 37: Financial goals for the next 12 months, by generation, August 2016
Parents are looking to assure a financially secure future
Figure 38: Financial goals for the next 12 months, by parent status, August 2016
Medium-term financial goals
Younger women express increased interest in their finances
Figure 39: Financial goals in one to five years, by gender and age, August 2016
Nearly half of Millennials want a second home in the next five years
Figure 40: Financial goal – Buy a second home, by generation, August 2016
Older adults are looking to splurge on a new ride
Figure 41: Financial goal – Buy a car – In one to five years, by generation, August 2016
Long-term financial goals
Generation X may be more realistic about paying off their mortgage
Figure 42: Financial goal – Pay off home mortgage, by generation, August 2016

CURRENT PERSONAL FINANCIAL SITUATION
Affluent/HNWIs have predictably healthy financial situations
Figure 43: Current personal financial situation, by household net worth, August 2016
Older adults are more satisfied with their current financial situation
Figure 44: Current personal financial situation, by generation, August 2016
Higher household incomes less positive about current financial health
Figure 45: Current personal financial situation, by household income, August 2016
Affluent/HNW Hispanics’ finances are OK
Figure 46: Current personal financial situation, by Hispanic versus non-Hispanic, August 2016

CONSUMER SEGMENTATION
Figure 47: Affluent/HNWI segments, August 2016
Frugal Spenders
Characteristics
Opportunities
Figure 48: Profile of Frugal Spender Affluent/HNWIs, August 2016
Value Conscious
Characteristics
Opportunities
Figure 49: Profile of Value Conscious Affluent/HNWIs, August 2016
Money Monitors
Characteristics
Opportunities
Figure 50: Profile of Money Monitor Affluent/HNWIs, August 2016
Spontaneous Spenders
Characteristics
Opportunities
Figure 51: Profile of Spontaneous Spender Affluent/HNWIs, August 2016
Nouveau Riche
Characteristics
Opportunities
Figure 52: Profile of Nouveau Riche Affluent/HNWIs, August 2016

APPENDIX – DATA SOURCES AND ABBREVIATIONS
Data sources
Fan chart forecast
Consumer survey data
Direct marketing creative
Terms

APPENDIX – THE MARKET
Figure 53: Holdings of family wealth, by Wealth Group, 1989-2013
Figure 54: Usual median weekly earnings of full-time wage and salary workers, by gender and age, Q3 2016

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