Summary
- • The global wealth management industry is estimated to be worth over $90 trillion.
- • The number of High Net Worth Individuals (HNWIs) globally reached 19.6 million in 2019.
- • As of 2020, the United States accounted for the largest share of global wealth management assets, with around $22 trillion.
- • The average fee for wealth management services ranges from 0.5% to 2% of assets under management.
- • Robo-advisors managed over $460 billion in assets worldwide in 2020.
- • Over 75% of high-net-worth individuals are interested in sustainable investing, according to a survey by UBS.
- • The global wealthtech market was valued at $6.2 billion in 2020.
- • Gender lens investing assets under management reached $3.4 billion in 2020, a 50% increase from 2018.
- • In 2020, the average advisory firm had a profit margin of 20%, according to InvestmentNews.
- • Wealth management firms spent $15.5 billion on technology in 2020, a 3.4% increase from the previous year.
- • Global private wealth is forecasted to reach $291 trillion by 2025.
- • The average age of a financial advisor in the US is 55 years old.
- • In 2020, global assets under management in the wealth management sector exceeded $100 trillion.
- • The average client acquisition cost for a wealth management firm is $3,000.
- • Impact investing assets under management grew to $715 billion in 2020.
Roll out the red carpet, because in the sprawling metropolis of the finance world, the Wealth Management Industry is the glittering starlet worth over $90 trillion, attracting a cast of 19.6 million High Net Worth Individuals vying for their share of the spotlight. With the United States leading the box office with $22 trillion in wealth management assets, its no wonder the average fee for such services ranges from 0.5% to 2%. And in a world where even robo-advisors have a seat at the table, managing over $460 billion in assets, its clear that the drama of sustainable investing is taking center stage, captivating over 75% of high-net-worth individuals. Welcome to the dazzling, fast-paced world of wealth management – where the stakes are high, the margins even higher, and the forecast is nothing short of blockbuster at $291 trillion by 2025.
Global Wealth Management Industry Overview
- The global wealth management industry is estimated to be worth over $90 trillion.
- The global wealthtech market was valued at $6.2 billion in 2020.
- Gender lens investing assets under management reached $3.4 billion in 2020, a 50% increase from 2018.
- Wealth management firms spent $15.5 billion on technology in 2020, a 3.4% increase from the previous year.
- Global private wealth is forecasted to reach $291 trillion by 2025.
- In 2020, global assets under management in the wealth management sector exceeded $100 trillion.
- Impact investing assets under management grew to $715 billion in 2020.
- The top 20 wealth management firms globally account for over 40% of total industry assets.
- Family offices globally manage more than $6 trillion in assets.
- Over 80% of wealth management firms see digital transformation as a strategic priority.
- The global private banking sector manages over $23 trillion in assets.
- The global wealthtech market is projected to reach $148.5 billion by 2028.
- Approximately 35% of wealth management clients express interest in ESG investing.
- The global wealth management software market is anticipated to grow at a CAGR of 5.4% from 2021 to 2026.
- Millennials are expected to inherit $68 trillion from their parents by 2030, driving demand for wealth management services.
- The global market for impact investing is projected to reach $1 trillion by 2024.
- Around 60% of wealth management firms are adopting AI and machine learning to enhance client service.
- By 2022, B2B wealth management software spending is forecasted to reach $4.1 billion.
- The demand for multi-family offices is increasing, with over 4,000 firms globally.
- Wealth management firms allocate approximately 25% of their budget to technology upgrades.
- The global market for digital wealth management is expected to grow at a CAGR of 15.3% from 2021 to 2028.
- Wealth management firms see an average of 11% growth in assets under management annually.
- The top 1% of high net worth individuals globally hold over 40% of total wealth.
- The majority of financial advisors believe that digital tools will enhance client engagement and retention.
- The global assets under management (AUM) in the wealth management industry reached $111.3 trillion in 2020.
- The average retention rate for wealth management clients is approximately 94%.
- The global wealth management industry is projected to grow at a CAGR of 5.7% from 2021 to 2026.
- The market size of the global wealth management industry is forecasted to reach $194.6 billion by 2026.
- Impact investing assets under management could grow to $2 trillion by 2025.
- In 2020, 72% of wealth management firms reported an increase in client assets under management.
- Wealth management firms saw an average revenue growth of 6.9% in 2020.
- Millennial investors are projected to hold $20 trillion in investment assets by 2030.
- The global wealth management industry employs over 1.2 million professionals.
- The average advisor-client ratio in the wealth management industry is 1:75.
- Alternative investments account for approximately 24% of total assets under management in the wealth management industry.
- The number of female financial advisors in the U.S. increased by 47% from 2015 to 2020.
- The wealth management industry is expected to witness a compound annual growth rate of 10.9% from 2021 to 2028.
- The global spending on wealth management software is projected to reach $4.8 billion by 2026.
- The global market for digital wealth management platforms is estimated to reach $145.1 billion by 2027.
- By 2030, global private financial assets are projected to amount to around $270 trillion.
- The Asia-Pacific region is expected to witness the fastest growth in the wealth management industry, with a CAGR of 9.7% from 2021 to 2026.
- By 2025, the global digital wealth management market is expected to exceed $145 billion.
- The median revenue per advisor in the wealth management industry is $590,000.
- In 2020, sustainable investing accounted for 33% of total assets under management in the wealth management industry.
- Swiss banks accounted for over $7 trillion in offshore wealth management assets in 2020.
- The global market for multi-family offices is estimated to reach $1.25 trillion by 2025.
- The global wealth management industry is projected to grow at a CAGR of 5.7% from 2021 to 2026.
- The total assets under management in the wealth management sector are expected to exceed $120 trillion by 2023.
Interpretation
In a world where money talks louder than most, the wealth management industry stands as a behemoth of staggering proportions, with figures that would make even the most seasoned investor sit up and take notice. With trillions upon trillions swirling around the global market, it's no surprise that firms are eagerly embracing technology, gender lens investing, and the ever-growing demand for ESG and impact investing solutions. As the industry hurtles towards a future where AI and machine learning rule the roost and digital platforms reign supreme, one thing is certain: the wealthy will always seek to grow their fortunes, and wealth managers, armed with data and innovation, are more than ready to help them on that journey.
High Net Worth Individuals (HNWIs) Statistics
- The number of High Net Worth Individuals (HNWIs) globally reached 19.6 million in 2019.
- Over 75% of high-net-worth individuals are interested in sustainable investing, according to a survey by UBS.
- Family offices hold an estimated $6.1 trillion in assets globally.
- The top 1% of households in the U.S. own 31% of total household wealth.
- In 2020, wealthy clients aged 40 and under held an average of $1.3 million in investable assets.
- The number of millionaire households in the U.S. reached 11.2 million in 2020.
- High-net-worth individuals in North America held over $24 trillion in wealth in 2020.
- Approximately 84% of high-net-worth individuals believe that financial advisors should offer seamless digital experiences.
Interpretation
With the number of High Net Worth Individuals soaring to 19.6 million in 2019 and family offices wielding a whopping $6.1 trillion in global assets, it seems the elite are not just stacking cash under their mattresses. Over 75% of these wealthy folks are now turning an eye towards sustainable investing, proving that green is the new gold. Meanwhile, the top 1% in the U.S. continue to hold an impressive 31% of total household wealth, while millionaire households multiply faster than rabbits in 2020. With wealthy young clients—sitting on an average of $1.3 million in investable assets—demanding seamless digital experiences, one can only imagine financial advisors scrambling to keep up. In this high-stakes wealth management game, the numbers speak volumes, but the question remains: is it all about the zeros, or is there room for a conscious capitalism makeover?
Robo-Advisors Assets Under Management
- Robo-advisors managed over $460 billion in assets worldwide in 2020.
- In 2020, the number of robo-advisor accounts reached over 71 million worldwide.
- Digital advice platforms are expected to reach $1.6 trillion in assets under management by 2023.
- Robo-advisors are expected to manage over $11 trillion in assets by 2023.
- The total number of robo-advisor clients is expected to exceed 140 million by 2023.
- The global market for robo-advisory services is expected to grow at a CAGR of 33.2% from 2021 to 2028.
Interpretation
The rise of robo-advisors in the wealth management industry is truly a force to be reckoned with, as evidenced by the eye-popping statistics of their ballooning assets and client base. Who knew that algorithms and digital advice could wield such financial prowess? With expectations of managing over $11 trillion and serving more than 140 million clients by 2023, robo-advisors are making traditional money managers rethink their reliance on human expertise. Looks like the future of wealth management might be less about handshakes and more about algorithms - a stark reminder that sometimes, the most valuable advice comes from a binary code rather than a boardroom.
United States Wealth Management Market Share
- As of 2020, the United States accounted for the largest share of global wealth management assets, with around $22 trillion.
- The average age of a financial advisor in the US is 55 years old.
- The average annual salary for a financial advisor in the US is $67,521.
- The number of registered investment advisors (RIAs) in the US surpassed 14,000 in 2020.
- The top 25% of financial advisors in the U.S. have an average client retention rate of over 98%.
- The average AUM per financial advisor in the U.S. is approximately $100 million.
- The average annual salary for a financial advisor in the U.S. is $76,330.
- As of 2020, registered investment advisory firms managed over $5 trillion in client assets.
Interpretation
In the world of wealth management, the United States reigns supreme both in sheer assets and seasoned financial advisors. With $22 trillion under its belt, it's no surprise that the average financial advisor here is a seasoned 55-year-old with a respectable average salary of $67,521. What's even more impressive is the client loyalty, with the top 25% boasting a retention rate over 98%. With over 14,000 RIAs navigating this lucrative landscape, each managing a hefty $100 million on average, it's clear that the American dream of financial success is alive and well, driving billions in client assets into the capable hands of these money masters.
Wealth Management Service Fees
- The average fee for wealth management services ranges from 0.5% to 2% of assets under management.
- In 2020, the average advisory firm had a profit margin of 20%, according to InvestmentNews.
- The average client acquisition cost for a wealth management firm is $3,000.
- Wealth management firms spend an average of 1-2% of their revenue on marketing efforts.
- The average fee for financial planning services is around $1,500 per year.
- Wealth management firms spend an average of $1 million on cybersecurity measures annually.
- The average cost of compliance for wealth management firms is around $500,000 per year.
- Wealth management firms spend an average of 50% of their budget on personnel costs.
- The average cost for a financial planning engagement ranges from $1,000 to $3,000.
- In 2020, the average fee for wealth management services was 1.02% of assets under management.
Interpretation
In the labyrinthine world of wealth management, where numbers dance around portfolios like enchanted coins, the statistics paint a vivid picture of the industry's bustling landscape. From the delicate art of balancing fees for services to the formidable fortification against digital marauders through cybersecurity investments, each dollar spent and earned is a small tile in a vast mosaic. Like a symphony conductor, wealth management firms carefully allocate resources, from client acquisition costs to compliance expenses, all while maintaining a balanced harmony between revenue and expenditure. In this financial ballet, every step counts, every figure waltzes towards the ultimate goal of safeguarding and growing the wealth of their clients.
