Who is the archetypical Singaporean multimillionaire? Is he the big spender who pays $4.23 million in the blink of an eye for aKoenigsegg Agera or one who parks his hyper car at his penthouse inHamilton Scotts? Is he the party thrower who routinely chalks up six-digit bills at nightclub Pangaea or the high roller putting $400,000 in a single bet at Marina Bay Sands, Singapore’s new casino?
Ever since Singapore embarked on its official mission to follow money, money has followed it with equal ardor. And along with that comes the stories of excess, over-the-edge wealth and stupendously rich indulgences. “ $26,000 cocktails. Traffic jams freckled with Ferraris. A380 jet converted to include a pool and basketball court. The world’s sternest city is now the richest,” declared a recent report by the Wall Street Journal
No untruth in that. Singapore is now the world’s fastest growing wealth hub with $1.3 trillion assets under management, and is slated to overtake Switzerland as the world’s largest offshore wealth center by 2020. Roughly one in every 30 Singaporeans was a dollar millionaire in 2012. It is estimated that by 2017, one in every 20 Singaporeans will be a millionaire. This segment that currently holds $857 billion, or 85.7% of the total individual wealth, will grow by 63% and hold $1.39 trillion by 2017. Among these millionaires, there are 3,870 multimillionaires (individuals with net worth of over $30 million) in 2012 with average wealth of $86 million per person and they will grow by 59% in the next five years. Singapore’s Gross Domestic Product per person is the world’s highest at $ 61,567, and the IMF expects this to rise to an astounding $77,000 in five years!
So, who is the man at the center of this success story? What is the profile of a typical Singapore multimillionaire? A new report by WealthInsight Intelligence Center –it tracks 60,000 millionaires around the world–puts the spotlight on the average Singapore multimillionaire. It breaks many a stereotype of the swash-buckling, cash-burning lifestyle of the rich in this island state.
The average Singapore multimillionaire is male, 66 years old, married and has 3 children. This makes him the oldest in the world in terms of average age, only a notch below those in Argentina or Austria. In fact, the global average age is 60 years.
Compared to his counterparts in the U.S. and U.K, where the average age is 60 and 57, the Singaporean fares low in the ranking for many reasons. The country has not had a long history of entrepreneurship that spans the globe like the young Americans or British. Neither has it had an education system or culture that was particularly high on innovation, creativity and enterprise. There is no Mark Zuckerberg of Facebook FB +1.68% or Nick D’Aloisio ofSummly here to bring down the average age of the multimillionaire as in the U.S. or U.K. Despite the high penetration of technology, Singaporeans have generally not seized on their potential to create wealth by taking their companies global.
The Singapore multimillionaire, in fact, is a reluctant entrepreneur. Only 35.7% have made their money from a business or company. And when they have chosen to do so, they opted to go through traditional businesses, like real estate, construction, hospitality, retail and food, that typically require longer periods for accumulating substantial amounts of wealth. The average age of a Singapore millionaire is 49, one of the lowest in the world, but that of a multimillionaire is the highest at 66.
The paradox can also be explained by the fact that a second avenue that mints a lot of the new and young rich in the West, like a Justin Bieber in the U.S. orAdele in the U.K., has not been available to the Singaporeans. There is no thriving film industry or music and mega sports industry to churn out millionaires.
So, how has the average Singaporean multimillionaire acquired his status? Surprisingly, from being the CEO or COO of a bank, hedge fund, private equity, venture capital, insurance or wealth advisory. An average Singapore multimillionaire has a day job and he makes wealth, off the millions and billions of dollars parked in Singapore or the nearby region by the ultra-rich. According to the WealthInsight report, the financial services industry grew 163%, between 2008 and 2012, accounting for 22% of multimillionaires and 35.3% of millionaires in Singapore.
As emerging Asia faces economic uncertainty, muddy politics, unpredictable policies and divided society, the allure of Singapore to the newly rich families of China, India, Malaysia, Philippines and Indonesia will be immense, says the report. They will keep flocking to Singapore.
So, that Ferrari which whizzed past you on Orchard Road was probably that of an Indonesian. And that high roller on the Baccarat table in the casino is probably a China “whale.” The average Singapore multimillionaire, in his pinstripe suit and horn-rimmed glasses, is at work on spreadsheets. He will then, most likely, go home to a quiet dinner with his wife and three kids.
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