UBS Investor Watch: UK insights on investor sentiment / 2Q 2018

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In this first global issue of UBS Investor Watch – the largest recurring survey of wealthy investors in the world – UBS explores the relationship between wealth, health and longevity. More than 5,000 wealthy individuals in the UK, Germany, Hong Kong, Italy, Singapore, Switzerland, Taiwan, the U.S., and the UAE shared their views with us. UBS found that today, around a third of wealthy individuals in the UK are confident about living to 100. Health is incredibly important and many are willing to give up significant levels of wealth to preserve it over such a long life.

Despite this confidence about living longer, many are anxious about the financial implications of extended old age. Healthcare costs are a key concern and affording care costs in later life is prominent on many people’s minds. Costs of more than £50,000 a year for good quality care are already being recognised and factored in by wealthy individuals.

In response to these challenges, many are already adjusting their spending or considering working for longer, past the traditional retirement age. More thought is also being put into long-term investment plans. Equities remain the asset of choice for the very long-term. Real estate is still as appealing as ever for many in the UK. Holding wealth in cash, which is popular in some places around the world, continues to have little merit here.

Succession planning is another area impacted by the 100-year life. We see a divide between wealthy individuals who are accelerating gifts and those who are pulling back.

Today, 60% plan to give more of their wealth to their heirs while they are still alive, starting this process earlier when the wealth may be more beneficial. Another growing trend is to give more of that wealth to grandchildren, rather than children as might previously have been expected. Wealthy individuals living in the UK are clearly adopting various tactics to preserve good health and navigate a 100-year life. As for whether they are successful, the ultimate judge will be time itself.