The wealth management group polled 200 hundred high net worth and ultra-HNW US citizens about their views on investment, financial plans and philanthropy and the year ahead.

High net worth and ultra-HNW Americans aren’t planning to cut spending significantly in 2023 despite economic storms, a survey from Clarfeld | Citizens Private Wealth has found.

The study was based on a poll of 200 people across the US.

A majority (80 per cent) of those interviewed plan to spend the same amount (51 per cent) or more (29 per cent). Respondents indicated that they are most likely to allocate additional resources to travel (51 per cent), their businesses and/or franchises (13 per cent) and real estate (10 per cent) in the new year. 

Additionally, 87 per cent think that the US is in, or will soon enter, a recession. Respondents cited inflation (31 per cent), market volatility (27 per cent) and rising interest rates (11 per cent) as factors that will have the greatest negative impact on their financial portfolios.

“Wealthy Americans have more tools at their disposal to ride out a recessionary environment, but they're not immune to volatility,” Matt Ruffalo, head of investment solutions, Clarfeld | Citizens Private Wealth said. “The biggest planning priority for wealthy investors in 2023 should be to ensure one’s portfolio allocations and savings strategies are prepared to weather both short- and long-term headwinds.”

Most respondents (81 per cent) plan to make changes to their portfolio allocations in 2023, increasing and decreasing allocations to meet their goals. The three asset classes where respondents plan to increase their investments the most include equities (41 per cent), fixed income (37 per cent) and cash (29 per cent). Respondents plan to cut allocations to cash (16 per cent), leverage or debt financing (14 per cent) and equities (12 per cent) in the year ahead.

In addition to overall allocation changes, the top financial tools Americans plan to use in 2023 include real estate investment trusts, or REITs (20 per cent), revocable trusts (17 per cent), non-revocable trusts (11 per cent) and spousal lifetime access trusts (10 per cent). Additionally, 40 per cent of respondents said they want to invest in alternatives next year. This interest was highest amongst Millennials (63 per cent), compared with their Gen X and Boomer counterparts, at 52 per cent and 29 per cent, respectively.  

Some 72 per cent of respondents said they plan to make a charitable donation at the end of the year. The primary reason for donating is altruistic, as 78 per cent are giving as part of their regular charitable giving. The tax benefits of giving also motivate 41 per cent of respondents to donate this year.

Fewer respondents (48 per cent) plan to give a financial gift to the next generation this holiday season. Of those who do plan to give, 62 per cent plan to gift a trust or contribution to a trust, 45 per cent plan to make a charitable donation in their name, 35 per cent plan to gift shares of stock and 25 per cent plan to gift NFTs/digital assets.