Yahoo Finance 4 Things the Super Rich Are Spending Their Money on in 2022
More than 51,000 people joined the ranks of ultra-high net worth individuals (UHNWIs) — those with assets of more than $30 million — last year, according to Knight Frank’s 2022 Wealth Report. It was largely thanks to soaring stocks and increased property prices during the pandemic.
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So what are the mega-wealthy doing with their money in 2022? Here’s a look at the main things super rich people buy.
Stocks
The wealthiest 10% of American households currently own 89% of all U.S. stocks, according to a CNBC report. Therefore, a large portion of the nation’s super rich have the markets to thank for their growing wealth.
Despite the fact that 2022 has been a rough year for stocks, billionaire investors continue to put money in them. In fact, they see it as an opportunity to buy at a discount.
So what stocks have they been buying? Fintech, in particular, seems to be a popular sector among billionaires. Paul Singer of Elliott Investment Management, for instance, took an approximately $2 billion stake in PayPal Holdings this year. Jeff Yass of Susquehanna International recently added nearly 6.6 million shares of Amazon during the second quarter, increasing his company’s stake to about 15.2 million shares.
And one of the most well-known billionaire investors, Warren Buffett, bought 30 million shares of Ally Financial as of August, in addition to many other stocks, including Occidental Petroleum, Chevron and HP.
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Real Estate
Even though the hot housing market has suddenly cooled, real estate continues to be a lucrative investment for the already-wealthy. Perhaps it’s because almost 90% ultra-rich individuals built — and maintain — their wealth by investing in real estate. The 2022 Wealth Report by Knight Frank found that on average, ultra-high net worth individuals hold just under two-thirds of their wealth in property, owning an average of three homes.
As you might expect, some of the most jaw-dropping property purchases so far this year have taken place in real estate hotspots like Los Angeles and New York City. Villa Firenze, for instance, is an impressive 12-bedroom, 16-bathroom mega-mansion in the Beverly Park neighborhood of California that was purchased by biotech entrepreneur Roy Eddleman last year. He’s putting it back on the market in 2022 and hoping to turn a big profit. Who will end up buying it — and for how much — is still up in the air.
Whoever it is will be in good company, with neighbors such as Adele, who bought her Beverly Park home for $58 million from Sylvester Stallone in February, and Mark Wahlberg, who recently listed his place for $87.5 million.
Space Travel
For better or worse, last year kicked off the billionaire space race, with the likes of Jeff Bezos, Elon Musk and Richard Branson pouring billions of dollars into personal space flight programs. Bezos, for instance, shelled out $5.5 billion to experience four minutes in suborbital space in his Blue Origin vessel.
There are no signs of billion-dollar space travel slowing down. Jared Isaacman, who flew on SpaceX’s Inspiration4 mission last year, purchased three more flights with the company. The first in a planned series of missions called “Polaris” is slated for launch in late 2022. “We’re going to go farther into space than humans have gone since we’ve last walked on the Moon,” Isaacman told “Today.”
Virgin Galactic also opened up ticket sales to the general public in February. A 90-minute trip to space is set at $450,000 per person, and the company plans to sell 1,000 tickets for commercial flights that will begin launching from its New Mexico spaceport later in the year.
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Charitable Donations
The super rich don’t just spend money on themselves. Many have also committed to giving large portions of their wealth away to people who need it more.
One of the world’s wealthiest men and top philanthropists, Microsoft co-founder Bill Gates, announced this year that he would donate $20 billion to the Bill & Melinda Gates Foundation. He reiterated his pledge to give away virtually all of his wealth so that he eventually drops off the list of the world’s richest people completely.
MacKenzie Scott, ex-wife of Jeff Bezos, is also known for giving away tremendous wealth. Recently, she donated two Beverly Hills mansions worth an estimated $55 million to Los Angeles-based organization California Community Foundation.
Indeed, these types of donations on behalf of billionaires are generous. However, critics point out that the rich tend to give in a way that benefits themselves and their social standing, such as to their alma maters and mainstream art institutions. Meanwhile, only 0.1% of the billionaire population makes donations to provide shelter for those experiencing homelessness, and the same number donate to organizations that focus on feeding the hungry, according to research by Wealth-X.
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