What Is a High-Net-Worth Individual (HNWI)?

High-net-worth individual (HNWI) is a person or family with liquid assets above a certain figure. The term is often used by the financial services industry. Although there is no precise definition of how rich someone聽must be to fit into this category, high net worth is generally quoted in terms of having liquid assets of a particular number. The exact amount differs by financial institution and region but could range from people with a net wealth of 6- to 7- or more figures.

The VHNWI classification鈥攙ery high-net-worth individual鈥攃an refer to someone with a net worth of at least $5 million. Ultra-high-net-worth individuals (UHNWI) are defined as people with investable assets of at least $30 million, usually excluding personal assets and property such as a primary residence, collectibles and consumer durables.

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High Net Worth Individuals

Understanding High-Net-Worth Individuals

A聽high-net-worth individual classification聽generally qualifies聽for separately managed investment accounts instead of regular mutual funds. This is where the fact that聽different financial institutions maintain varying standards for HNWI classification comes into play. Most banks require that a customer have a certain amount in liquid assets and/or a certain amount in depository accounts with the bank to qualify for special HNWI treatment.

The most commonly quoted figure for membership in the high-net-worth club is around $1 million in liquid financial assets. An investor with less than $1 million but more than $100,000 is considered to be "affluent" or perhaps "sub-HNWI." The upper end of HNWI is around $5 million, at which point the client is then referred to as "very HNWI." More than $30 million in wealth classifies a person as "ultra HNWI."

HNWIs are in high demand by private wealth managers. The more money a person has, the more work it takes to maintain and preserve those assets. These individuals generally demand (and can justify) personalized services in investment management, estate planning, tax planning and so on.

Key Takeaways

  • A high-net-worth individual (HNWI) is somebody with around $1 million in liquid financial assets.
  • HNWIs are in high demand by private wealth managers. The more money a person has, the more work it takes to maintain and preserve those assets.聽
  • The United States had the most HNWIs in the world in 2019, at more than 5.9 million people.

Where Do聽HNWIs聽Live?

More than 60% of the world's HNWI population lives in the United States, Japan, Germany and China, according to the Capgemini World Wealth Report. The U.S. had 5.9 million HNWIs in 2019, up 11% from the year before.

As a group, the HNWI population saw its assets grow 8.6% in 2019, reaching $74 trillion in wealth. Asia accounted for $22.2 trillion, followed by North America with $21.7 trillion, Europe with $16.7 trillion, Latin America with $8.8 trillion, the Middle East with $2.9 trillion and Africa with $1.7 trillion.

Capgemini separates the HNWI population into three wealth bands: millionaires next door ($1 million to $5 million in investable wealth), mid-tier millionaires ($5 million to $30 million) and Ultra-HNWIs (those with more than $30 million). Globally, the Ultra-HNWI population numbered 183,400 in 2019. Mid-tier millionaires numbered 1.75 million, while millionaires next door was the largest group at 17.6 million.

Country HNWI population  YoY growth
United States 5,909,000 11%
Japan 3,387,000 8%
Germany 1,466,000 9%
China 1,317,000 11%
France 702,000 11%
U.K. 591,000 6%
Switzerland 438,000 14.%
Canada 392,000 8%
Italy 298,000 8%
Netherlands 287,000 11%
Top 10 countries for High Net Worth Individuals, 2019

Source: Capgemini World Wealth Report.