Thursday, February 26, 2015

The Ultra High Net Worth!

If you're interested in the world of the rich and famous, no doubt you've run across the initials UHNW in magazine articles, blogs, even on Twitter nowadays. But what does that mean exactly?

It stands for Ultra High Net Worth. Basically it's tossed around by marketers and advertising agencies as to where they should target their ads for high-end products, as well as by wealth managers when referring to their clients. But more and more we hear the term used in other settings to describe the super rich and all the things they're up to. So I thought I might jump in here with some observations.

Here's the breakdown of terms in historical order:

- The Affluent ($100,000): Back in the days after World War II, this original term was used to describe someone who owned their own home and cars, and had a hundred-thousand-dollars or more in liquid cash for investments or purchasing expensive goods.

- High Net Worth ($1,000,000): Likewise, this term was used to describe someone who had accumulated at least a million dollars in liquid cash to invest or make high-end purchases, and it's still in use today in some circles.

- Very High Net Worth ($5,000,000): As wealth grew over the years and people became even richer, this term popped up to describe those who have five-million or more to play around with.

- Ultra High Net Worth ($30,000,000): Around 2007 we first began to hear the term UHNW come into play, and it seems to be where we're stuck today. More often than not it's used to describe people with thirty-million-dollars or more to toss around.

By saying 'stuck' with this term at the moment, it seems to me there's an inherent danger with this type of reductive labeling. The problem is that in the last few decades we've seen billionaires springing forth all around the globe with way more spending power than the mere millionaires.

To cite one simple example, on a whim a billionaire can afford to buy and staff a luxury yacht that costs $120,000,000 which the UHNW with only $30,000,000 in the bank couldn't possibly touch, right? And buying a private island for a hundred-million-bucks would be above the price range of the average UHNW - not to mention building a house there, staffing it fully, and adding a small port to accommodate the yacht upon arrival.

So why would advertisers and investment counselors continue to lump all these people under one umbrella at the thirty-million-dollar level, unless they think the UHNW are on their way to becoming billionaires themselves? It's a mystery to me. Sociologically speaking, the term is useless as well. Quite honestly there's very little likeness between the super rich and the lowly millionaires in this world.

Perhaps it's time to have a new category altogether to separate the millionaires from the billionaires, maybe something simple like the Billionaires Net Worth (BNW). What do you think? It makes sense to me.

But then we'd have to dig deeper I guess, to separate the poor billionaires with only two or three billion in the bank from the ones who have seventy billion or more, like Warren Buffet and Bill Gates. What would we call them? The Ultra High Billionaires Net Worth (UHBNW)?

I thought the terms Super Rich or the One Percent were clear as a bell and pretty much described who we're talking about. In fact, in his New York Times bestseller Richistan, the famed Wall Street journalist Robert Frank calls them the 'Absurdly Rich' which pretty much suffices, don't you think?

But the term Ultra High Net Worth seems to be chic nowadays, gaining in popularity, and it may be around for awhile.

Thanks for dropping in,



  1. "Ultra High is too low?"
    "Yes, we need to go straight to... Ludicrous Wealth!"
    gasp "Sir, we've never gone that high before."
    "What's the matter jeeves... chicken?"
    "Prepare accounts for ludicrous wealth! Open all vaults, notify all next of kin, retain all lawyers, burn all not couture clothing, cancel all appointments that don't involve royalty..."

    1. Yes, "Ultra High" is too low in my opinion to differentiate between those who have the Mill's and those who have the Bill's - no pun intended. And as for gearing up for the infusion of massive wealth, you're probably not far off.

      But you better stop calling me Jeeves this very moment. Remember, I have a delete button and you don't, ha!

      Hope all is well with you in Australia. (Where exactly is that, by the way?)

  2. Chris Rock covered this topic in one of his stand up HBO specials years ago and I have yet to hear anyone describe it better (or more humorously). He only had two categories: rich and wealthy. He said Rick James was rich. Rich is when you can lose your entire fortune in a bad weekend in Vegas and have to do Old Navy commercials to pay your bills. Wealthy people can't go broke. They own things like the color blue.

    Michael Jordan is rich. The person who signs his checks is wealthy (this was back when Jordan was still playing basketball).

    The funniest bit to me was when he said that if Bill Gates woke up one morning and had Oprah Winfrey's money, he'd jump out a window and kill himself.

    All humor aside, I like the characterization of the two categories. If you can conceivably lose all your money because the economy takes a nosedive or property values fall or your business goes under, then to me you're "simply" rich. You're wealthy when you're insulated from poverty or even from sinking into middle-class-dom, regardless of what the financial markets do.

    1. Thanks for sharing that, Stacy. Chris Rock's hysterical assessment of the situation is pretty much on target, ha!

      That skit can be seen on YouTube by the way (under "Chris Rock - Wealthy and Rich") if anyone wants to see it.

    2. Sorry, he said Shaq not Jordan. Don't know where I got Jordan from.

  3. As i once read, truly rich people measure themselves and each other by just how close they can come to doing "The Scrooge Mcduck money dive!"

    1. LOL! That could be true, Christopher. Thanks for reading, and for your comment. Andrew