High Net Worth individuals rank the prospect of a change in UK government as the single biggest threat to their financial wellbeing – and more of a threat than Brexit, according to new research by wealth manager Saunderson House.

The research, part of a major study of financial wellbeing among UK High Net Worths, finds that two fifths (42%) believe a change of government is one of the main threats to their finances.

The second most cited threat is a deterioration in mental and physical wellbeing in other walks of life (34%). Geopolitical instability is ranked third (30%), a category which covers current flashpoints such as Brexit and US President Donald Trump’s trade wars.

Gareth Parsons, Financial Planning Director at Saunderson House, says:

“It is striking that a change of government ranks as a bigger financial threat than Brexit and other geopolitical issues, especially considering the dramatic predictions of the consequences of a potential no-deal scenario. For High Net Worth individuals, fear of the unknown is currently the dominant emotion when thinking about their financial wellbeing.

“Our in-depth interviews found that fears over change of government largely relate to the prospect of a radically changed tax landscape under a Corbyn-led Labour government, with some citing fears of ‘Argentine-style pensions savings raids’. If we do see a change of government, its new leaders may want to offer reassurance and certainty that it will stick to the changes it proposes in its manifesto, and that more radical tax measures beyond that currently feared by some aren’t on the cards.”

Other fears

Saunderson House’s research reveals a range of other factors which High Net Worth individuals view as potential threats to their financial wellbeing. They include a collapse in the UK property market, cited by a quarter (26%), and a long-term rise in inflation (23%). Fears of a house price collapse are more common among High Net Worths with assets of under £5 million (27% of £1-3m, 35% of £3-5m), with wealthier respondents typically warier of long-term rises in inflation (33% of £5-10m, 37% of those valued over £10m).

Worries about geopolitical instability are most acute among High Net Worths over 65 (45%) and those worth over £10m (40%). Job loss is identified as the main worry among respondents aged under 50, being feared by more than half (54%).

The results come from broader research by Saunderson House into what drives financial wellbeing among High Net Worth individuals. While the research finds emotional factors play a large part, fears around less controllable macroeconomic factors, such as a change in government, also feature as potential threats to wellbeing.

Gareth Parsons at Saunderson House adds:

“Financial advice can’t prevent a change in government, an increase in tax rates or a rise in inflation. But it can help people frame and manage those risks effectively. Seeking counsel on how best to diversify investments and setting financial objectives which include financial wellbeing goals can help provide clarity and comfort in the event of economic turmoil.”


Notes for editors
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Tyron Wilson / tyron@linstockcommunications.com / +44 7876 343 580

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