Even if most plain folks don't save a quarter of their gross annual incomes. "The rich are very different from you and me" the legend has F. Scott Fitzgerald telling Ernest Hemingway. "Yes," answered Hemingway, "they have more money." Now additional support for Hemingway's commonsense take on the matter has come in the form of a new report from the Spectrem Group.

"Images of the ultra wealthy jetting around in private planes, sipping Champagne on gigantic yachts and driving bright-red Ferraris turn out to be quite overdone," says Catherine McBreen, managing director of the Spectrem Group, a Chicago-based research firm and financial-service consultancy. "In fact, those with $5 million or more in net worth generally do not spend it on ostentatious items."

Green thumbs

McBreen says that only one in seven of the 526 ultra-wealthy households Sprectrem interviewed had spent over $50,000 on cars in the previous 12 months. Only 2% had bought, rented or chartered a private aircraft of any description. |image1|

In fact, instead of indulging in particularly conspicuous consumption, people in the $5-million-plus category spend their leisure time traveling, reading, playing golf, keeping fit and -- wait for it -- gardening.

Around 84% of those surveyed by Spectrem say their top financial goal is to achieve a "comfortable standard of living during retirement," and 97% attribute their success to "hard work."

Spectrem's Ultra-High-Net-Worth Investor 2006 also suggests that the wealthy save or invest as much as 23% of annual gross income. Nearly half of all high-net-worth households own a second or vacation home.

The study also shows that more than half rate philanthropy an important part of their lives. They generally make contributions to religious, educational, social service and cultural organizations.

In addition to profiling the spending habits of ultra-high-net households, Ultra-High-Net-Worth Investor 2006, which goes for $40,000, provides insights into high-wealth market demographics, advisor-client relations, investment attitudes and behaviors, asset-allocation and product-ownership habits, and planning around financial "situations" and turning-point life events. -FWR

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