The Rich: Where They Live, How They Spend and Invest

butler standingIt can be argued that various media publications have made something of a cottage industry by locating dense concentrations of High-Net-Worth Individuals (HNWIs) in the U.S..

Numerous surveys enlighten us about where the wealthiest towns, zip codes and cities are.

Through actual photos, Forbes has teased us with a collection of homes in the 100 most expensive ZIP codes in the U.S.

The salient pattern seems to be, as Forbes Magazine (2/12/13) put it, that "the wealthiest tend to cluster around the largest cities on either coast." Presumably, this is in part because they want places to shop, good restaurants, and other wealthy people to associate with.

Often, these surveys tend to be drawn from census and IRS data. One of these surveys, published by, lists the 100 richest zip codes in the U.S., beginning with Greenwich, Beverly Hills, Lake Forest, Westport, and New York.

How The Rich Spend

As far as the spending habits and leisure activities of HNWIs are concerned, they seem to differ from the mean both in their instinct for thrift and in their love of grand gestures and extreme personal freedom.

Numerous surveys and studies have shown that most HNWIs are fairly mild mannered in their day-to-day spending and recreation. They tend to live in fairly ordinary houses and neighborhoods. They tend to be fairly thrifty and prefer durability over luxury.

On the other hand, many HNWIs can afford the occasional flamboyant luxury, especially the wealthiest among them. Possibly, they also possess greater than average animal spirits, which may perhaps call for outward expression.

For these reasons and others, HNWIs are far more likely to spend large sums on private jets, fancy travel in general (travel seems to be by far their favorite recreational activity), boats, jewelry, and expensive alcohol.

According to Hank Darlington of Darlington Consulting, HNWIs are spending on home décor and technology, while very expensive cars and large remodeling jobs are out of favor (Supply House Times, 8/1/11).

Assets of the Rich

In December 2013, Research and Markets, a respected research firm, reported that in 2012, U.S. HNWI liquid assets amounted to $4.01 trillion, which represents 18.9% of their total wealth holdings.

They also reported that business interests represented the largest asset class for this group at 30.3%. Equities were next at 27.4%, then real estate at 16.9%, fixed income at 11.0%, cash at 8.8%, and alternative investments at 5.6%.

rich clusters map

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