How Wealthy Americans Spend Their Money in These 14 Categories

Americans with great wealth are able to spend money on things others cannot afford, such as collectibles, or spend vastly more on everyday items, including clothing and home improvement.

A new whitepaper from Spectrem Group examines very wealthy investors' spending habits, looking in particular at items that for the most part are not necessities.

Spectrem collected data this year from 168 investors across the U.S. with a net worth of $25 million or more through mail and an online survey, completed by the person primarily responsible for making day-to-day financial decisions within the household.

The study notes that although very wealthy Americans buy the luxury items they want, they do not necessarily toss money at extravagances willy-nilly.

The majority also contribute to charity. New research on wealthy donors' philanthropic engagement and perspectives found that 91% of these households donated to charity in 2015, well ahead of the share of the general population that did so.

In the following breakdown of individual spending categories, the study notes when appropriate the difference between the spending habits of these wealthiest Americans and those collected in a separate study whose net worth is between $5 million and $25 million, not including primary residence.

Home Improvement

1. Home Improvement

Over the last 12 months, investors with a net worth of $25 million or more spent a lot of money on home improvement:

$0 — 8%
$1 to $24,999 — 46%
$25,000 to $49,999 — 20%
$50,000+ — 27%

Household Staff

2. Household Staff

The wealthiest investors can afford household staff, such as maids, nannies, drivers and lawn maintenance personnel. Over a 12-month period:

$25 million+

$0 — 9%
$1 to $9,999 —30%
$10,000 to $24,999 — 22%
$25,000 to $49,999 — 21%
$50,000+ — 18%

$5 million to $25 million

$0 — 29%
$1 to $9,999 — 67%
$10,000 to $24,999 — 5%
$50,000+ — 1%

Education

3. Education

College: Spectrem noted that percentages will change over time as offspring either become old enough to attend college or graduate. Over the 12-month period, 64% of study respondents spent money on college education, and 12% spent more than $100,000.

Prep school: Not all of the respondents send their children to prep school, but 53% did pay prep school tuition and fees, and 11% spent more than $100,000.

Gambling

4. Gambling

Over 12 months, only half of the study group gambled. Fifteen percent gambled less than $10,000, while 27% gambled at least $25,000.

Collectibles

5. Collectibles

About three-quarters of the study group spent money on collectibles in the 12-month period, while only a third of those with $5 million to $25 million did so.

$25 million+

$0 — 27%
$1 to $9,999 — 22%
$10,000 to $24,999 — 13%
$25,000 to $49,999 — 17%
$50,000+ — 21%

$5 million to $25 million

$0 — 67%
$1 to $9,999 — 28%
$10,000 to $24,999 — 4%
$25,000 to $49,999 — 1%

Clothing

6. Clothing

Counterintuitively, perhaps, some folks in the study group claimed not to have bought new clothes over the 12-month period:

$0 — 4%
$1 to $9,999 — 40%
$10,000 to $24,999 — 25%
$25,000 to $49,999 — 7%
$50,000 to $99,999 — 11%
$100,000+ — 13%

Jewelry

7. Jewelry

Jewelry can cost a lot of money, and a sizable proportion of the investors studied were willing to cough up:

$0 — 13%
$1 to 24,999 — 55%
$25,000+ — 32%

Automobiles

8. Automobiles

Spectrem assumed a new car will cost at least $25,000, indicating that less than half of the wealthy investors in the study bought a new vehicle in the previous 12 months. About half had other auto expenditures:

$0 — 16%
$1 to $9,999 — 22%
$10,000 to $24,999 — 24%
$25,000 to $49,999 — 10%
$50,000 to $99,999 — 13%
$100,000+ — 15%

Boats

9. Boats

Half the wealthiest investors in the study are boat people, half are not. Only a small fraction of those with $5 million to $25 million spent money on boats in the prior 12 months:

$25 million+

$0 — 50%
$1 to $9,999 — 11%
$10,000 to $24,999 — 8%
$25,000 to $49,999 — 14%
$50,000+ — 17%

$5 million to $25 million

$0 — 93%
$1 to $9,999 — 4%
$10,000 to $24,999 — 3%

Entertainment

10. Entertainment

The arts: A majority of the study group interested in the arts spent less than $10,000 in the last year on plays, symphonies, art shows and museums, but 8% went all out, spending at least $100,000.

Sports: Wealthy investors over the past 12 months were able to spend money on season tickets and individual game tickets, which are expensive these days:

$0 — 13%
$1 to $9,999 — 42%
$10,000 to $24,999 — 11%
$25,000 to $99,999 — 26%
$100,000+ — 8%

Vacation or Leisure Travel

11. Vacation or Leisure Travel

Investors in both the lower and upper levels of wealth spent often considerable amounts on vacations in the past year:

$25 million+

$0 — 5%
$1 to $9,999 — 22%
$10,000 to $24,999 — 25%
$25,000 to $49,999 — 19%
$50,000+ — 29%

$5 million to $25 million

$0 — 4%
$1 to $9,999 — 48%
$10,000 to $24,999 — 33%
$25,000 to $49,999 — 12%
$50,000+ — 3%

Club Memberships

12. Club Memberships

Twenty-two percent of investors in the study group had no club memberships on which to spend money in the 12-month period, while more than half spent upward of $10,000 on their club memberships.

Charitable Contributions

13. Charitable Contributions

The vast majority of the wealthy investors in the study made contributions to charitable causes in the previous year:

$0 — 4%
$1 to $9,999 — 40%
$10,000 to $24,999 — 25%
$25,000 to $49,999 — 7%
$50,000 to $99,999 — 11%
$100,000+ — 13%

14. Political Contributions

Over the year studied, a quarter of investors contributed upward $25,000 to political causes. At the same time, more than a quarter did not make such contributions.

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How Wealthy Americans Spend Their Money in These 14 Categories

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