Wealth: 65% of UK savers hit by COVID-19

Almost two thirds (65%) of wealthy UK savers and investors have seen their finances hit by the coronavirus pandemic, a new report by IRN Research found.

Consumers are characterised as “wealthy” if they have a minimum of £75,000 held in investment or saving products — 80% of these have saving and investment wealth of £100,000 or more, according to IRN Research.

Some 65% have been impacted by COVID-19, with the value of their money held in savings and investment products falling, with individuals holding £500,000 and above feeling the negative effects of COVID-19 the most.

The pandemic and resulting lockdown has led to a sharp drop in sentiment regarding the growth of wealth over the past year. Pre-COVID-19, over 70% of wealthy savers and investors were happy with the growth of their wealth, compared with just under 50% today.

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Despite this, around half have decided to take no action and effectively ride out the storm rather than change how they save and invest.

Although the wealthiest savers have been hit the worst by COVID-19, they still saw the highest return on their savings and investment over the past 12 months. The average wealthy saver earned a return of around 5.8% over the past year, but this went up to 9.8% for those with £500,000 or more in wealth.

The report found that the wealthy were more likely to be male rather than female, more likely to live in London compared with the not wealthy, and were older than the not wealthy, although a comparatively large percentage of the wealthiest fall into the 35-44 age group.

IRN Research also said that, when investing and saving money, the wealthy are characterised by being more likely than the not wealthy to plan ahead, more willing and financially able to accept risk and financial losses and therefore invest in assets carrying higher returns and higher risk, and more likely to check and monitor their savings and investments on a monthly basis.

The wealthy were also more likely to to take professional financial advice and so are less likely to be under-advised.

READ MORE: UK pensioners lose £30m to scammers

However, the report also highlighted that like less wealthy savers and investors, the wealthy can also be vulnerable to financial scams and product mis-selling.

Scammers have been taking advantage of the COVID-19 pandemic to “cash in,” with scams skyrocketing by 66% since pre-lockdown, according to figures from Barclays.