Australia, still the lucky country?

Sunday 13 October 2013

Article by Mozo

Australia has the best distribution of wealth among developed nations according to the recently released Global Wealth Report from Credit Suisse.

Australia, still the lucky country?

According to the report Australians have the highest median wealth in the world, with average household wealth having grown a staggering 13% a year since 2000.

Emerging markets kept global wealth on the rise, doubling wince 2000 despite the financial crisis however, Australia was the only one of the developed nations to have also experienced a significant growth in wealth over the period.

Australia's average wealth is $426,100 per adult, which is second only to Switzerland.  However, Australia's median wealth is the highest in the world, at $233,504.

The measure of median wealth gives an indication of distribution of wealth in a society and is higher in a relatively equal society. When it comes to distributions of wealth, 62.6% of Australians had wealth between US$100,000 and US$1million with only 6.9% of Australians having a net worth less than $10,000 - an extremely low segment of the population by global standards.

Unsuprisingly, Australians were found to be heavily invested in 'real assets' as opposed to financial ones, meaning for the most part our wealth is invested in bricks and mortar. Australia was found to have the second most prolific real asset allocation in the world behind Norway.

Australia also account for 3.8% of the worlds richest, despite making up only 0.4% of the worlds population.

The report also volunteered two reasons for our remarkable growth in personal wealth. Credit Suisse suggests that the remarkable growth of Australian wealth in due in large part to the strength of the Australian dollar against the US dollar. Making Australian assets relatively more valuable compared to those of other countries.

The other key reason offered for our economic success is our tertiary education system and Higher Education Contribution Scheme (HECS), which compared to those offered around the world, offer a facility for comparatively low and manageable student loan debt. 

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