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50,000 Indian Americans are high net worth individuals: Study
Thursday, 12 June 2003, 19:30 IST
NEW YORK: India had an estimated 50,000 high net worth individuals in the U.S. at the end of 2002, compared with 45,000 in the previous year, says a study released here by Merrill Lynch and Cap Gemini Ernst & Young.
The annual study, titled "World Wealth Report 2003", also said that the expertise of Indians in information technology and software, in turn, helped in the expansion of wealth of many non-resident Indians (NRIs) in the U.S.
The study, in its seventh year, defined high net worth individuals (HNWIs) as those with financial assets of over $1 million.
"The net worth of Indians in the U.S. did reduce as the Internet bubble burst. We also saw volatile capital markets and collapse of the technology sector," Jyoti Chopra, director of South Asian business at Merrill Lynch's multicultural and diversified business development group, told IANS.
"But despite these adverse developments, the South Asian community around the world, continues to grow and build wealth," she said after the official release of the report.
The report was released jointly by James P. Gorman, executive vice president of Merrill Lynch, and James Greene, vice president of Cap Gemini Ernst & Young.
Pointing out some interesting facets of HNWIs among the South Asian community, Chopra said that only 24 percent of Asian Americans in the category have a financial plan, while 52 percent use a financial advisor.
"In today's volatile markets, this can make it very difficult to preserve, let alone grow wealth," she said, adding that almost half of the Asian Americans do not have an estate plan.
Chopra, nevertheless, said the NRI community is highly conservative when it comes to business and finance, with a strong propensity toward saving.
"Education and saving for future education needs, for the next generation, continues to be a high priority," she said.
"Retirement saving and planning is also very important," Chopra said, adding that as much as 90 percent of Indian business is family-owned, making it a complex inheritance planning.
Quoting the 2000 census report, Chopra said South Asians were the sixth largest foreign population in the U.S., with more than 1.8 million people of Indian origin. This is the fastest-growing foreign population in the country with the number of people of Indian origin surging 105.9 percent in the decade till 2000.
Gorman and Greene said that globally, there were 7.3 million HNWIs at the end of 2002, showing a growth of 2.1 percent or 200,000 individuals. This they said was the lowest in the seven-year history of the report.
Their combined wealth rose approximately 3.6 percent to $27.2 trillion, despite a drop in most equity markets around the globe.
They added that almost 90 percent of HNWIs globally were in the $1 million to $5 million financial assets band, and less than one percent belonged to the ultra-HNWI wealth category -- those with more than $30 million in financial assets.
Source: IANS
Source: IANS