Last year was a tough one for the global pocketbook.
For the first time since the 2008 financial crisis, household wealth across the globe dropped, by a total of 2.4 percent, Bloomberg reported on Tuesday. About $11.3 trillion was lost from assets, bringing total net private wealth to $454.4 trillion, according to Credit Suisse’s annual global wealth report. In contrast, global wealth in 2021 soared to a record-high $530 trillion, a Boston Consulting Group report from last year found.
“Wealth evolution proved resilient during the Covid-19 era and grew at a record pace during 2021,” Nannette Hechler-Fayd’herbe, the global head of economics and research at Credit Suisse, told Bloomberg. “But inflation, rising interest rates and currency depreciation caused a reversal in 2022.”
North America and Europe were hit particularly hard last year, losing a combined total of $10.9 trillion. While the United States is one of the wealthiest countries in the world, Americans on average saw a drop of $27,700, The Wall Street Journal noted. And about 1.7 million U.S. adults fell out of the millionaire category, while 17,260 can no longer call themselves ultra-high-net-worth individuals with $100 million or more. (Around the world, the total number of millionaires fell by 3.5 million, to about 59.4 million people. And the globe’s 1 percent saw their wealth share drop to 44.5 percent.)
While the overall trends appear negative, a few places did see wealth growth in 2022. Russia, for example, gained 56 millionaires, despite sanctions related to Russian President Vladimir Putin’s war in Ukraine. And Latin America saw its wealth jump by $2.4 trillion. Those bumps were in part due to stronger currencies in both regions.
Even with 2022’s downward slump, though, Credit Suisse experts believe that wealth will continue to grow in the next few years. Predictions say that global wealth will reach $629 trillion by 2027, a 38 percent increase from the most recent figures. And the total number of millionaires should rise to 86 million by that year, too.
So perhaps some of those who have fallen off the millionaire list will make back their money in the next five years.