By definition the richest households in Britain hold a disproportionate percentage of the total wealth of £10.3 trillion, but a new survey shows the formidable magnitude of this disparity
By definition the richest households in Britain hold a disproportionate percentage of the total wealth of £10.3 trillion, but a new survey shows the formidable magnitude of this disparity.
According to the Wealth and Assets Survey (WAS), conducted by the Office for National Statistics, the top 10 per cent have £1.2 million of cash, property and pensions, while the bottom 50 per cent have only £4,400. Meanwhile, the 1 per cent have at least £2.8 million.
The wealthiest tenth of households own more than 40 per cent of overall wealth and are over 850 times wealthier than the least wealthy tenth. Median household wealth is £232,000.
Bloggers have expressed concern and alarm at this divide. One user of the Guardian website, pter1960, commented that he wished he ‘could work 850 times harder like rich people do’.
The survey aimed to address gaps identified in data about the economic well-being of households. It gathered information on several points, including ‘the level of assets, savings and debt; saving for retirement; how wealth is distributed among households or individuals; and factors that affect financial planning’.
The entry level for the top 10 per cent is £967,000, while to be in the bottom 10 per cent you need to have less than £13,000.
London and the South East had the highest percentage of ‘wealthy’ households (above £967,000), with 12.5 per cent and 15.5 per cent respectively. In Scotland, only 6.9 per cent are in this category.
The divide is starkest in pensions: the top decile have accrued pension savings of £742,000, whereas the bottom 50 per cent have £4,000. The top decile also have property with an average value of £340,000, while the bottom 50 per cent have zero net property wealth.
Almost 96 per cent of wealthy households own at least one car, compared with 58 per cent of the bottom half. Personalised number plates are more prevalent among the wealthy too: among the wealthy, one in seven cars sports a personalised plate whereas only one in forty of the bottom 50 per cent of households has.
The study reveals that the more affluent household heads are three times more likely to hold a degree level qualification or higher than the least wealthy household heads. Consequently, it was found that just over one in every four household heads living in the least wealthy half of all households held high-skilled managerial or professional occupations, starkly contrasting the almost four out of every five living in the wealthiest 10 per cent of households.
This may be connected to the mean age of the household heads, with almost 38 per cent of the top tenth of households being aged 55 to 64 as opposed to 24 per cent of the bottom half aging between 25 and 24 years old. The study therefore suggests that wealth accumulates as people approach retirement.