A recent study of over 5000 consumers across four continents has revealed the amount of net annual income needed for people to feel happy is an imposing US$161,810 – 15 times the global average* for an individual’s income. Overall, some 80% of individuals believe that earning this amount each year would make them feel really happy. This is according to the findings of the Wealth Sentiment Survey**, a study commissioned by the international investment company Skandia International, part of Old Mutual Wealth.
The research, conducted with 5000 people across 13 territories, found that the highest levels of aspired income were quoted by individuals living in Dubai who would need more than a quarter of a million US$ to feel happy - or US$276,150 to be precise. The next highest financial aspirations were recorded in Singapore and Hong Kong, where the levels of desired annual income are as high as US$227,563 and US$197,702 respectively. Generally, respondents from Europe feel that much less is required to keep them satisfied, with people in Germany reporting the most modest needs of all countries surveyed (US$85,781). The UK has the second highest price of happiness in Europe at US$133,010, behind Italy at US$175,825.
Interestingly, in some territories women reported having higher ambitions than men in order to feel content. For example, in Hong Kong, Italy and Brazil women say they desire 13% (US$207,924), 11% (US$187,036) and as much as 55% (US$192,929) per annum respectively in excess of the amounts quoted by men in order to feel happy.
This extensive study, which looked to explore and understand people’s feelings towards wealth, found that globally, only three in twenty individuals regard themselves as wealthy and that to qualify for the status, an average of US$1.76m in disposable assets is required.
In Singapore, the average figure quoted was an ambitious US$2.9m, whilst Dubai and Hong Kong cited the next highest levels at US$2.5 and US$2.46 respectively. Europe, on the other hand, reported relatively modest, and lower than the average, requirements needed for somebody to be considered wealthy. People living in Austria and Germany stated they would need just US$0.9m and US$1m to call themselves wealthy.
Interestingly people in Austria and Germany also reported a higher than average sentiment of feeling ‘wealthy’, with over one in five stating this to be the case for them. Overall, the highest wealth sentiment was recorded in Brazil, where more than a quarter of people said they feel affluent.
Phil Oxenham, marketing manager at Skandia International comments:
‘There are many more things in life that can make people happy but there is no doubt that money can help. It is fascinating to see the regional differences in levels of income and capital that people think they need to feel happy and wealthy. These figures are, of course, aspirational and for most of us the important thing is to have a financial plan and make sure that we are saving as much as we can to give us financial security.”
To view the full report highlighting the key findings please click here.
* Based on IMF’s assessment of individual economic output in 2012 adjusted for Purchasing Power Parity.
** Skandia International has commissioned CoreData Research to carry out a global study of wealth sentiment to gain a better insight into the issues that are impacting savings, investing and spending decisions of people across a range of geographic territories.
The research was carried out in Q3 2012 online, and involved more than 5,000 people (5,007) with net disposable incomes of £1000 (or equivalent) drawn from 13 territories across Asia, Europe, Latin America and the Middle East.