Wealth increases across Berkshire

Thirty-six per cent rise for richest households since 2008

A REPORT commissioned by wealth manager Kleinwort Hambros reveals that overall wealth in Great Britain has grown by 4.5% a year since the financial crisis of 2008, from £8.5 trillion to £11.5 trillion.

For the most prosperous households, the report reveals that pensions, rather than property, represent the biggest proportion of total wealth, illustrating the strong performance of the financial markets.

In Greater London, however, the report findings reveal that the wealthiest households have more invested in property than pensions.

Based on data from the Wealth and Asset Survey and additional research from the Centre of Economics and Business Research (CEBR), the report reveals that the top 10 per cent of households have at least £1m in aggregate wealth.

Aggregate wealth is defined as the sum of financial wealth (such as stocks and shares), physical wealth (such as art and cars), property (net of any mortgage) and pension assets.

The richest households in Berkshire have £1.278m in aggregate wealth, up from £941,000 in 2008, an increase of 36%.

The biggest increase during this period has come from pension wealth, which is up by 47% over the period.

Following the trend of Greater London, the richest households in Berkshire have most of their wealth in property, with the 90th percentile for property wealth standing at £573,000 in property wealth, compared to £517,000 for pension wealth and £210,000 for financial wealth.

Rebecca Constable, who leads the team of private bankers in Kleinwort Hambros’ Newbury office, said: “It is important not to underestimate the power of the financial markets and our findings reveal how strongly the financial markets have performed since the financial crisis, in particular.

“Investing in a pension early is essential and starting 10 years earlier can make the difference of up to £571,000 in a pension pot by the age of 65.”

She added that the report findings reveal that for households across Great Britain, saving and investing continues to be important, particularly as life expectancy increases.

“We can see that reinvesting dividends can lead to a considerable difference in wealth accumulated over the long term,” she explained.

In total, eight of the wealthiest 10 districts and counties in Great Britain are located in the South East, underlying the regional concentration of wealth.

The first counties outside the South East to appear in the top 10 list are West Essex, the Isle of Wight and Dumfries and Galloway in Scotland.

Ms Constable added: “Although it is not in the top 10 wealthiest districts in Great Britain, we can see there is considerable wealth being generated in Berkshire.

“It certainly is an up-and-coming place of wealth and asset creation, driven by the rise of entrepreneurial wealth, as well as a great concentration of professionals and executives in the area.

“There is no doubt that the county could be in the top 10 within the next generation.”