The Credit Suisse World Wealth Report for 2021 was released recently. The major Swiss bank has been reporting annually on global wealth since 2008. Which country had the highest wealth levels on the planet at the end of 2021?

It depends how you measure wealth. Credit Suisse defines wealth as the total of a person’s financial assets plus their real (property) assets, minus their debts. The figures are expressed in US dollars.

Measuring typical wealth can be done two ways. The mean wealth is the average wealth per adult. This simply takes the total personally owned assets and divides the figure by the adult population. On this scale Australia comes in fourth, after Switzerland, the United States and Hong Kong.

Switzerland and the US in particular have a small number of extremely wealthy individuals, but the majority of the population have much lower asset levels. This enables those countries to score well on the mean scale but that isn’t a very good indicator of the typical wealth of most people.

The mean allows countries with a large gap between the few very rich and the many poor to score well. The second method of determining typical wealth uses the median. This is the middle score. If the median is chosen, half the population has more wealth than that and half has less.

By this measure Australians are the wealthiest people on earth with US$273,900 of net assets per adult. Following us come Belgium, New Zealand, Hong Kong and Denmark in order.

Switzerland comes in sixth but the US is well down the list at eighteenth. This shows how unevenly their wealth is spread, with a median of only US$93,270 per person, about one third of the level in Australia.

It is well known that Australians favour property as a means of growing their wealth. The figures show that, with around sixty per cent of Australian’s wealth in property and only forty per cent in financial assets including shares and bank deposits.

Many countries’ citizens have more than half their wealth in financial assets. In the US the figure is over seventy per cent, with less than thirty per cent in property.

The Credit Suisse World Wealth Report shows that Australia has 2,177,000 adults with wealth in excess of US$1 million each. That was an increase of 390,000 in the number of US dollar millionaires in 2021. 

The outlook for Australian’s wealth isn’t so good with house values declining in the capital cities and shares performing poorly this year. However, when interest rates peak and start to decline share prices and financial markets should grow strongly. That is likely in 2023.