Table of Contents
Executive Summary
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- Top takeaways: what emerging affluent and affluent consumers want from their finances
- Target audience overview
- Impact of COVID-19 on the financial needs of emerging affluent and affluent consumers
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- Figure 1: Short-, medium- and long-term impact of COVID-19 on the financial needs of emerging affluent and affluent consumers, December 2020
- Opportunities and challenges
- Despite higher income, decision factors for affluent are the same as everyone else
- Perceptions of wealth and success evolve with age
- Emerging affluent and affluent are confident in their financial skills – how can financial brands step in to help?
Affluence by the Numbers
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- Over 20% of US population has $75K or more in income
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- Figure 2: Percentage of households with $75K or more in total money income, 2000-18
- Median income continues to climb to just over $63K
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- Figure 3: Median income in the United States, 2000-18
- Great wealth transfer as Baby Boomers age
Household Investable Assets
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- Majority have $500K in investible assets
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- Figure 4: Household investible assets, October 2020
- Highest concentration of assets among older consumers
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- Figure 5: Household investible assets, by age, October 2020
- Among older consumers, men hold more assets
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- Figure 6: Household investible assets, by age and gender, October 2020
- Household income not the only determining factor of assets
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- Figure 7: Household investible assets, by household income, October 2020
Ownership of Financial Products
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- Affluent consumers are familiar with financial products
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- Figure 8: Financial product ownership, October 2020
- Men are more interested in investment accounts
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- Figure 9: Financial product ownership, by gender and age, October 2020
- Loan products are far more present among emerging affluent
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- Figure 10: Financial product ownership, by gender and age, October 2020
- Affluent adults have the most accounts – of all kinds
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- Figure 11: Financial product ownership, by household investable assets, October 2020
Companies and Brands – Key Takeaways
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- Fidelity launches zero-fee ETFs
- Robo-advisors and low-fee planning put new pressure on margins
- Credit card rewards programs match new COVID-19 spending habits
Competitive Strategies
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- Fidelity launches zero-fee ETFs
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- Figure 12: Fidelity Zero online ad, December 2020
- Robo-advisors and low-fee planning put new pressure on margins
- Credit card rewards programs pivot with COVID-19 spending habits
The Consumer – Key Takeaways
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- Emerging Affluent and Affluent consumers use most financial products
- These consumers have half-million of investible assets
- Having already achieved many goals, opportunity lies in the process
- Location still major factor in bank choice
- Opportunity for credit card rewards to attract affluent consumers
- Firm reputation drives choice of investment company
- Financial advisors most trusted source of financial information
- Opportunities for more financial advice
- Emerging affluent and affluent consumers are confident
Financial Goals
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- Affluent consumers already achieved many financial goals
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- Figure 13: Financial goals, October 2020
- Younger men looking to buy home and vehicle
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- Figure 14: Near-term financial goals, by gender and age, October 2020
- Younger women aspirational about second home
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- Figure 15: Long-term financial goals, by gender and age, October 2020
Factors Influencing Bank Choice
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- Location still major factor in bank choice
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- Figure 16: Factors influencing bank choice, October 2020
- Mobile banking and service crucial for Millennials
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- Figure 17: Factors influencing bank choice, by generation, October 2020
- Emerging affluent seeking better rates
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- Figure 18: Factors influencing bank choice, by household investable assets, October 2020
Factors Influencing Credit Card Choice
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- Credit cards rewards programs draw affluent consumers
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- Figure 19: Factors influencing credit card choice, October
- Interest rates most important to affluent Millennials
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- Figure 20: Factors influencing credit card choice, by generation, July 2020
Factors Influencing Investment Company Choice
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- Investment companies chosen based on firm reputation
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- Figure 21: Factors influencing investment company choice, October 2020
- Men are more concerned about investment company cost
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- Figure 22: Factors influencing investment company choice, by gender, October 2020
- More investible assets mean more desire for services
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- Figure 23: Factors influencing investment company choice, by investible assets, October 2020
Trusted Sources of Financial Information
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- Financial advisors most trusted source of financial information
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- Figure 24: Most trusted sources of financial information, October 2020
- Women trust the human element
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- Figure 25: Trusted sources of financial information, by gender, October 2020
- Alternative sources gain trust among younger audiences
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- Figure 26: Trusted sources of financial information, by generation, October 2020
- Households with highest investible assets more likely to trust an advisor
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- Figure 27: Trusted sources of financial information, by household assets, October 2020
Attitudes toward Financial Advice
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- Most don’t regularly seek out financial advice
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- Figure 28: Attitudes about financial advice, October 2020
- Young men comfortable outsourcing investments
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- Figure 29: Attitudes about financial advice, by gender and age, October 2020
Attitudes about Mobile Finance
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- Mobile finance not crucial, but trends younger
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- Figure 30: Attitudes about mobile finance, October 2020
- Millennials want mobile, frequent service
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- Figure 31: Attitudes about mobile finance, by generation, October 2020
Attitudes about Personal Wealth
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- Emerging affluent and affluent consumers are confident
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- Figure 32: Attitudes about personal wealth, October 2020
- Perceptions of wealth and success evolve with age
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- Figure 33: Attitudes about personal wealth, by generation, October 2020
- More assets not necessarily linked to more happiness
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- Figure 34: Attitudes about personal wealth, by investible assets, October 2020
Appendix – Data Sources and Abbreviations
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- Data sources
- Consumer survey data
- Abbreviations and terms
- Abbreviations
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