Australians generally think of their country as a wealthy nation, but how does the individual wealth of an average Aussie stack up globally? And what about the many who are not sharing that wealth?
According to the Australian Bureau of Statistics, household wealth is defined as “economic resources in the form of the balance of assets and liabilities held by members of a household”.
Basically, it’s the ratio of money and assets people in a household have versus what they owe. The balance of this calculation, whether positive or negative, is referred to as your ‘net worth’.
Depending on how you look at it, Australians have it pretty good. The average Australian now has a net worth of more than US$550,000. Collectively, Australian households have a staggering $14 trillion in wealth and the number is steadily growing.
This ranks us at number four globally in terms of wealth per capita, behind Switzerland, the US and Hong Kong.
Australia is home to almost 2.2 millionaires, putting us in eighth position behind the US, China, Japan, the UK, France, Germany and Canada.
Michael Marr, head of Australian wealth management at Credit Suisse, says those numbers are predicted to rise in coming years.
“Over the next five years, the number of American dollar millionaires in Australia is expected to increase 35 per cent from 2.2 million in 2021 to 2.9 million millionaires in 2026,” he says.
Not bad, hey? The lucky country after all.
But if you’re reading this thinking you don’t have anywhere near that much, then you’re certainly not alone.
The thing about averages is they are skewed enormously by a few very high net worth individuals – think billionaires, of which Australia is home to a total of 139. These individuals have an average net worth of $3.6 billion.
And while it’s true that the raw number of millionaires and billionaires in Australia is going up, it appears to be at the expense of everyone else.
Last year, the richest 1 per cent of Australians held 21.8 per cent of the country’s total wealth, which is up from 19.6 per cent in 2007.
The richest 10 per cent of Aussies have an average net worth of $6.1 million and account for 46 per cent of total wealth.
In contrast, the bottom 60 per cent had an average of $376,000 per household, or just 17 per cent of the total.
This may be the lucky country, but it appears it’s only lucky for some.
Do you know your net worth? Is the share of wealth in Australia sustainable? Let us know what you think in the comments section below.
Also read: New report reveals Australia’s changing attitudes towards wealth
“Australia is home to almost 2.2 millionaires, ”
I think you mean 2.2 million millionaires.
Where do these figures come from? Nothing like I have seen from other sources. Can’t believe this source of information.
Averages mean nothing. The median figures would be more useful.