Inside the Wealthy’s Playbook: How wealthy people master their money with financial gymnastics

A Mastercard study shows that the wealthy optimize their wallets to live well and leave a legacy

SINGAPORE, (ANTARA/PRNewswire) – Mastercard today announced that 73% of wealthy consumers like to be careful with their money, with 48% even using “financial gymnastics” to maximize their profits. These consumers, who are in the top 10% of household income domestically, juggle multiple payment methods, plan their spending carefully and rely on various sources of information such as word of mouth and proactive research. At the same time, they cleverly manage multiple payment options such as credit, debit and prepaid cards or alternative payment methods and plan their use for different transactions, such as credit for travel or debit for everyday items. By optimizing their wallets, they want to take advantage of incentives, live comfortably and save to leave a legacy.

Bend over backwards to maximize yield

Mastercard’s study, which surveyed 29,536 consumers in 23 markets worldwide[1] (including the wealthy in Australia, Hong Kong SAR and India) found that wealthy consumers look for many ways to get the perfect wallet. Carefully considered payment decisions help them make the smartest choice with every transaction and earn points, rewards and discounts. Their high level of commitment to payment options also extends to how the wealthy want to benefit from their financial institutions. 69% worldwide trust that they can take advantage of the capabilities of their financial service providers. These perks include discounts on purchases or reduced prices on dining and entertainment.

The study also found that wealthy consumers are more conscious of their finances to maintain their comfort levels. Your payment decisions are based on convenience, but not at the expense of security. Payment methods that are widely accepted, reliable, portable, fast, and offer security are becoming the first choice. In particular, they also want to feel respected as they seek an emotional connection to the variety of payment options in their customized wallets, with credit cards tending to be the most popular.

Credit cards remain at the top of wealthy consumers’ wallets for a few key reasons: 47% say perks (like cash back, airline miles, shopping points, etc.) influence usage decisions, while 31% prefer credit to make them feel valued, and 27% prefer credit because of the purchase protection it offers. A look into the wallets of wealthy consumers shows that they contain more credit cards (2.1 vs. 1.7) and more payment methods overall (6 vs. 5 on average) than the wallets of mass consumers, showing their willingness to do more, to maximize the incentives of each transaction. Here in APAC, wealthy consumers use even more payment methods, with an average of 7.5 per person.

In comparison, debit cards are the preferred payment method for mass consumers, especially when purchasing everyday items. Interestingly, the preference for debit is particularly strong in Australia (83% for debit versus 58% for credit) and India (85% for debit versus 64% for credit), while Hong Kong relies more heavily on credit (79% versus 42%). by direct debit).

“Wealthy consumers tend to be very smart about choosing and using the payment tools in their wallets and strategizing how and when to use each payment method to reap the greatest returns. This practical, conscious approach reflects the growth mindset and commitment.” “The self-improvement that affluent consumers demonstrate in all aspects of their lives, including careers, health and wellness, hobbies and learning,” said Sandeep Malhotra, Executive Vice President, Products & Innovation, Asia Pacific, Mastercard. “And while ambition has always been a core characteristic of the wealthy demographic, the difference is that today they work to live, rather than just live to work, reflecting a shift from previous norms. The financial institutions that best serve this population recognize these characteristics and find valuable ways to support their customers’ financial, professional and personal development.”

To illustrate this point, the study found that while career advancement is critical to 30% of the world’s affluent demographic, it is not the most important pursuit overall, with 52% saying it is their top personal goal for the next five Years ago it was time to travel abroad more. Here in the Asia-Pacific region, some geographical differences emerged. Wealthy people in Australia prioritize travel (58%) over career (19%), while wealthy people in India focus on both pursuits (48% career, 56% travel). Hong Kong is in the middle: 30% focus on career and 40% value travel.

Willing to take risks for outsized returns

To improve their financial situation, wealthy people around the world are rapidly adopting new payment methods as they discover innovative ways to build wealth. Due to their higher risk tolerance (45% are willing to take risks) compared to mass consumers (65% of whom prefer to avoid risks), the study found that 38% of wealthy consumers are early adopters of new financial technologies (fintech), while only 25% of them are This is the case for mass consumers. The wealthy are embracing and leveraging fintech innovations before they become mainstream and are enthusiastically exploring new solutions that fintechs offer, including alternative payment methods such as mobile payments and digital wallets.

While the affluent segment is more open to experimenting with fintech, time is money once a new payment method is added to their wallet. This means that affluent consumers expect an easy and smooth onboarding process. New cards must be set up quickly, digitally and in just a few steps and must be easily linked to other accounts. To achieve this quickly, 45% of affluent consumers worldwide would prefer to pay a little more to save time, while only 37% of mass consumers would be willing to do so.

Plan ahead to leave a legacy

Finally, Mastercard’s study found that 59% of wealthy people place more value on possessions. After establishing a solid financial foundation that covers their daily expenses, they want to eat out, be entertained, and travel. When comfort and security are assured, the important pillars of family, life fulfillment and financial intention come together with their longer-term view and the desire to live a life of meaning and purpose.

This manifests itself in the wealthy’s ultimate long-term goal of leaving a legacy (i.e. resources) to their loved ones. Wealthy consumers around the world are 1.3 times more likely than the global population to prioritize saving for their inheritance, and 1.4 times more likely to have a financial goal of building an inheritance – times higher. Beyond their immediate circle, the wealthy also strive to leave the world or their community a better place.

[1] The APAC study surveyed mass consumers in five markets: Australia, India, Indonesia, Malaysia and the Philippines. In APAC, affluent consumers were surveyed in three markets: Australia, Hong Kong SAR and India.

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About Mastercard (NYSE: MA), www.mastercard.com

Mastercard is a global technology company in the payments industry. Our mission is to connect and drive an inclusive digital economy that benefits everyone, everywhere by making transactions safe, simple, smart and accessible. Using secure data and networks, partnerships and passion, our innovations and solutions help individuals, financial institutions, governments and businesses achieve their greatest potential. With connections in more than 210 countries and territories, we are building a sustainable world that opens up invaluable opportunities for everyone.

Source: Mastercard

Reporter: PR Wire
Publisher: PR Wire
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