Millionaires Now More Pessimistic than the Affluent

Chicago, May 7, 2008 /PRNewswire/ — Spectrem Group announced today that its Spectrem Millionaire Investor Index (SMII)(R) fell 1 point in April to -14, dropping below the affluent index for the first time ever.

The decline in the millionaire index brings it to a new record low of -14, a mildly bearish reading and 1 point below its previous all-time low of -13, set in March 2008. The April decline represents that continuation of a downward trend for the index that began in June 2007. Since June, the millionaire index has registered a net decline of 34 points.

Meanwhile, the Spectrem Affluent Investor Index (SAII)(R), which measures the investment outlook of households with $500,000 or more in investable assets, rose 7 points in April to -13, following a March 2008 decline. Like the millionaire index, it stands in mildly bearish terrain for a second consecutive month. However, for the first time since both indexes' inception in February 2004, the millionaire index stands below the affluent index.

"Millionaires have become more pessimistic about their investments than the broader affluent population for the first time since we began tracking both measures in early 2004. Continuing a downward trend that began in June, millionaires' optimism eroded once again in April, sinking to a new low as the prospects for a recession continued to weigh heavily. However, the investment outlook for the affluent was buoyed by April's financial market upswing. With the nation's economic outlook remaining uncertain, it will be interesting to see if the millionaires' increased pessimism will be borne out," said George H. Walper, Jr., President of Spectrem Group and co-author with Spectrem Managing Director Catherine S. McBreen of the new book "Get Rich, Stay Rich, Pass It On: The Wealth-Accumulation Secrets of America's Richest Families" (Portfolio, January 2008).

In response to an open-ended question about the one factor most affecting their investment plans, affluent investors in April cited: stock market conditions (27%), the economy (17%), retirement issues (6%), housing and real estate (4%), household cash flow (4%), household income (2%) and job security (1%). The percentage choosing stock market conditions rose from 26% in January 2008, the last time this question was asked.

Millionaires expressed slightly more concern about stock market conditions (28%), retirement (7%) and housing and real estate (6%) in April than the affluent.

  Historical Performance — 6 Months

                 November   December   January    February   March     April
  Spectrem
   Affluent
   Investor
   Index(R)        -5          0        -13         -10       -20       -13
  Spectrem
   Millionaire
   Investor
   Index(R)         3          8         -6          -5       -13       -14


The Spectrem Affluent Investor Index(R) is based on 250, 10-minute telephone interviews each month, giving the data a margin of error of plus or minus 6.2 percentage points. Interviews are conducted with the financial decision-makers in households with $500,000 or more in investable assets. The Spectrem Millionaire Investor Index(R) is based on a subset of the overall survey group that can vary each month. It is typically drawn from more than 100 monthly interviews.

The Spectrem Affluent Investor Index(R) and the Spectrem Millionaire Investor Index(R) are announced at 8 a.m. Eastern time on the first Wednesday of each month.

Report Availability
Spectrem Group's monthly report series presenting and analyzing the Spectrem Affluent Investor Index(R) and all of its components, including the Spectrem Millionaire Investor Index(R), is available for purchase at http://www.spectrem.com/ or by contacting Spectrem Group, 641 W. Lake Street, Suite 402, Chicago, IL 60661, (312) 382-8284.

About Spectrem Group
Spectrem Group is a strategic consulting firm specializing in the affluent and retirement markets. It integrates proprietary research with expertise in building business, marketing and M&A strategies. Spectrem professionals have held senior management positions at leading global companies. Through a collaborative process, they create and implement practical and profitable strategies that fit the cultures of client firms.

Catherine S. McBreen and George H. Walper, Jr., Spectrem Group's Managing Director and President, respectively, are authors of the new book "Get Rich, Stay Rich, Pass It On: The Wealth-Accumulation Secrets of America's Richest Families" (Portfolio, January 2008).

Source: Spectrem Group

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Posted by Mark Rodrigues at 5/12/2008 11:42 AM
Categories: wealth marketing
 

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