Pity the billionaire: it's expensive being rich

"It's a hard life if you don't weaken," lamented Arthur Seaton, the hero of the 1960 film
Saturday Night and Sunday Morning, summing up the lot of the working class as he looked forward to another week " sweating his guts out" over his lathe in a Nottingham factory. How times have changed.

Now, it seems, it is the rich who have it hard. A survey shows the wealthiest members of society are now engaged in a rearguard effort to maintain their gilded lifestyles, bedevilled with runaway inflation in the luxury goods sector.

Those of us not in the market for an executive box at Stamford Bridge or a case of Chateau Lafite Rothschild may struggle to feel sorry for the super-rich, but for them it is no laughing matter. The conclusion of the latest Stonehage Affluent London Living Index (Salli) was surprise at "how expensive it is being rich", with luxury goods rising in price three times faster than their more mundane consumer counterparts.

There are two reasons for the present Salli inflation rate of 6 per cent, said Robby Hilkowitz, executive director of the Stonehage Group which helps the world's super-wealthy manage their incomes. "Global wealth is growing at an unprecedented rate and as it increases they want more luxury goods to meet their lifestyle needs. With status items, the more expensive they become the more desirable they become.

"The second reason is that the supply of many of these items, from fine wines to Chelsea tickets, are finite but the amount of money chasing them is going up."

There are some 800 US dollar billionaires in the world, a figure that rose by 15 per cent last year. They are among the class of ultra-high net worth individuals with a personal fortune in excess of £25m of net investable assets. The second tier covered by the survey, so-called high worth individuals with more than £5m to spare, grew by 20 per cent.

Mr Hilkowitz believes the growth in the luxury market remains sustainable despite mounting fears that the credit crunch will lead to a general economic recession. He said many of his clients had already made their money and were living off the proceeds of their fortunes although the rate of luxury inflation was likely to reduce to twice that of the normal index compared to the current level of threefold.

"The reason we did this study was not to make people think 'oh, those poor people'. We kept coming up against this figure showing how much growth was needed to help our clients get the most out of their assets," he said.

Inflation was even higher when the cost of buying a property in central London was factored in. House prices in areas such as Kensington and Chelsea have soared more than 150 per cent in the past five years – easily outstripping Manhattan where prices have risen by 74 per cent.

Where the money goes...

* School Fees (Up 6.8 per cent)

With a history dating back to the time of Pope Alexander III, Westminster offers one of the most desirable old school ties around. One term's fees for two seniors cost £17,304 in 2007.

* Outdoor activities (Up 8.3 per cent)

Blasting away on the grouse moors of northern Britain was once the preserve of the landed gentry. Today any old hedge fund manager can have a go with a two-day shoot costing £3,600 in 2007.

* Vintage wines (Up 116.9 per cent)

Surely there can be no more famous wine than that emanating from the Rothschild's family vineyard in the Medoc? But three cases of Lafite Rothschild 2000 will set you back £9,250 this year.

* Exclusive facilities (Up 20 per cent)

Sweat with the best, or at least the richest, of them at The Dorchester Gym and Spa. A year's membership cost £1,800 in 2007.

* Luxury accessories (Up 26.7 per cent)

Patek Philippe once made watches for Queen Victoria and Tchaikovsky. The Swiss manufacturer could make one for you too. A limited edition Calatrava cost £19,000 in 2007.

* Football tickets (Up 25 per cent)

Jose Mourinho may be gone, but Chelsea FC remains the footballing choice of the west London glitterati (apologies to Brentford). One season's executive box hire at Stamford Bridge cost £117,500 in 2007.

PROMOTED VIDEO
Have you tried new the Independent Digital Edition apps?
News
ebooksNow available in paperback
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs General

Selby Jennings: Leveraged Finance - Senior Associate - International Bank - Frankfurt

Competitive + bonus: Selby Jennings: My client, a growing European CIB are loo...

Savvy Media Ltd: Media Sales executive - Crawley

£25k + commission + benefits: Savvy Media Ltd: Find a job you love and never h...

Austen Lloyd: Corporate Solicitor NQ+ Oxford

Excellent Salary: Austen Lloyd: CORPORATE - Corporate Solicitor NQ+ An excelle...

Reach Volunteering: Financial Trustee and Company Secretary

Voluntary Only - Expenses Reimbursed: Reach Volunteering: A trustee (company d...

Day In a Page

In a world of Saudi bullying, right-wing Israeli ministers and the twilight of Obama, Iran is looking like a possible policeman of the Gulf

Iran is shifting from pariah to possible future policeman of the Gulf

Robert Fisk on our crisis with Iran
The young are the new poor: A third of young people pushed into poverty

The young are the new poor

Sharp increase in the number of under-25s living in poverty
Greens on the march: ‘We could be on the edge of something very big’

Greens on the march

‘We could be on the edge of something very big’
Revealed: the case against Bill Cosby - through the stories of his accusers

Revealed: the case against Bill Cosby

Through the stories of his accusers
Why are words like 'mongol' and 'mongoloid' still bandied about as insults?

The Meaning of Mongol

Why are the words 'mongol' and 'mongoloid' still bandied about as insults?
Mau Mau uprising: Kenyans still waiting for justice join class action over Britain's role in the emergency

Kenyans still waiting for justice over Mau Mau uprising

Thousands join class action over Britain's role in the emergency
Isis in Iraq: The trauma of the last six months has overwhelmed the remaining Christians in the country

The last Christians in Iraq

After 2,000 years, a community will try anything – including pretending to convert to Islam – to avoid losing everything, says Patrick Cockburn
Black Friday: Helpful discounts for Christmas shoppers, or cynical marketing by desperate retailers?

Helpful discounts for Christmas shoppers, or cynical marketing by desperate retailers?

Britain braced for Black Friday
Bill Cosby's persona goes from America's dad to date-rape drugs

From America's dad to date-rape drugs

Stories of Bill Cosby's alleged sexual assaults may have circulated widely in Hollywood, but they came as a shock to fans, says Rupert Cornwell
Clare Balding: 'Women's sport is kicking off at last'

Clare Balding: 'Women's sport is kicking off at last'

As fans flock to see England women's Wembley debut against Germany, the TV presenter on an exciting 'sea change'
Oh come, all ye multi-faithful: The Christmas jumper is in fashion, but should you wear your religion on your sleeve?

Oh come, all ye multi-faithful

The Christmas jumper is in fashion, but should you wear your religion on your sleeve?
Dr Charles Heatley: The GP off to do battle in the war against Ebola

The GP off to do battle in the war against Ebola

Dr Charles Heatley on joining the NHS volunteers' team bound for Sierra Leone
Flogging vlogging: First video bloggers conquered YouTube. Now they want us to buy their books

Flogging vlogging

First video bloggers conquered YouTube. Now they want us to buy their books
Saturday Night Live vs The Daily Show: US channels wage comedy star wars

Saturday Night Live vs The Daily Show

US channels wage comedy star wars
When is a wine made in Piedmont not a Piemonte wine? When EU rules make Italian vineyards invisible

When is a wine made in Piedmont not a Piemonte wine?

When EU rules make Italian vineyards invisible