Australia gained nearly 400,000 new millionaires last year as wealth inequality widens

The number of millionaires in Australia grew by nearly 400,000 in 2021 and is expected to grow even further as the number of wealthy people around the world grew thanks to stock and housing market profits.

According to Credit Suisse’s most recent annual Global Wealth Report, 390,000 Australians became millionaires in 2021, bringing the total to 2.18 million.

The report measures wealth in US dollars, meaning the number of Aussies worth more than $1 million in local currency is likely to exceed the current figure of 2.18 million.

Lachlan Murdoch's superyacht Istros in the Sydney Superyacht Marina
The number of millionaires in Australia increased by nearly 400,000 in 2021. (Brook Mitchell/Sydney Morning Herald)

Despite having less than half a percent of the world’s total population, Australia is now home to 3.5 percent of the world’s millionaires.

And Credit Suisse expects that number to rise even further. It says that by 2026, the number of millionaires in Australia will increase by 35 percent, to 2.94 million.

It may not be surprising given the rise in the number of millionaires, but the report found an increase in wealth inequality in Australia in recent decades.

“In 2007… the wealth share of the top one percent of adults was only 19.6 percent,” the report states.

“By 2021…the share of the top one percent was 21.8 percent.”

In general, however, Australians are listed as the richest people in the world, with a median wealth (meaning 50 percent of Australians are below 50 percent of Australians above) per adult of $415,300.

Pump-and-dump schemes involve promoting a stock on questionable grounds and then selling it after others buy back.
The number of wealthy people around the world grew thanks to the surge in the stock and housing markets. (Ben Rushton)

Measured by average wealth (with total wealth being distributed among the adult population), Australia ranks fourth in the world at $834,200 per adult, behind Switzerland, the US and Hong Kong.

The report calculated wealth as the value of financial assets plus real assets (mainly housing) owned by households, minus their debt.

While Australia’s millionaire rise was remarkable, it was nothing compared to the US, where there were 2.5 million new millionaires in 2021.

Globally, the total number of millionaires at the end of 2021 stood at 62.5 million, Credit Suisse estimated.

The report found that total global wealth totaled $703 trillion at the end of last year, a jump of 9.8 percent.

Unsurprisingly, the two largest economies – the United States and China – posted the largest gains in household wealth, followed by Canada, India and Australia.

While Australia’s millionaire rise was remarkable, it was nothing compared to the US, where there were 2.5 million new millionaires in 2021. (AP)

Each country was likely helped by a significant increase in economic output in 2021, combined with “vigorous” activity in their respective housing or stock markets, the bank said.

This has again exacerbated global inequality, which has already worsened significantly during the pandemic.

2020 saw a historic setback in the fight against poverty in the world: according to the World Bank, the number of the world’s poorest rose for the first time in more than 20 years.

While overall poverty has declined slightly since then, the institution estimates that tens of millions more people could be living in extreme poverty this year than previously thought, “due to the lingering effects of the pandemic, the war in Ukraine and rising inflation.” .”

That’s in stark contrast to the happiest in the world, even though they’re not immune to those factors.

Last year, the top net worth share rose one percent “for the second year in a row,” Credit Suisse said in its report. Those individuals accounted for 45.6 percent of world wealth in 2021.

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