Entrepreneurship top source of wealth for North East

Entrepreneurship has been named one of the main sources of wealth in the North East, taking the top spot alongside personal finance, in a new set of figures.

The latest edition of Barclays Wealth Insights showed that entrepreneurship is now one of the most common sources of wealth for high net worth individuals in the region.

The category outstripped inheritance by three times with 48% of those surveyed naming entrepreneurship as their main source of wealth, compared with just 13% for inheritance.

Aside from entrepreneurship, other common sources of wealth in the North East are personal investments, 48%, and savings from income and bonuses over time, 44%.

And a third of HNWIs in the North East, 34%, agree that wealth can be created faster today than in the past.

Entitled, ‘Origins and Legacy: The Changing Order of Wealth Creation’ the global report surveyed more than 2,000 HNWIs, comprising entrepreneurs, business leaders and investors.

The findings reflect expert views that the growth of global wealth is now being driven by entrepreneurship, rather than inheritance, as entrepreneurs are found to accumulate wealth faster than HNWIs who have made their money through earnings, bonuses or inheritance.

In the UK, it took entrepreneurs and business owners an average of 19 years to accumulate their wealth, compared to 24 years for other HNWIs.

18% of respondents in the North East reported that they had accumulated the majority of their wealth in under 10 years.

Andrew Miller, Director, Wealth and Investment Management, Barclays Newcastle, said: “This report shows us that the order of wealth creation is shifting in the North East, with a significant number of high net worth individuals accruing their assets through entrepreneurial ventures or personal investments, rather than inheritance.

“It is encouraging that this current generation of wealthy individuals is focused on using their wealth to help others, with a number of those in the North East putting aside a large proportion of their assets for philanthropic giving or helping family and friends.

““These findings help us to understand how the picture of wealth is changing in the region, and ultimately, how this affects business and investment decisions.”

56% of HNWIs in the region cited charity as one of the uses of their wealth, the highest number in the UK, and 94% to family and friends either during their lifetime or through inheritance.

Moreover, 76% of HNWIs in the North East tend to give to charitable causes out of a sense of duty and responsibility, and 50% because it brings them a sense of personal fulfilment.

Emma Turner, Head of Client Philanthropy at Barclays said: “There is undoubtedly a different spirit to giving, depending on how an individual has accumulated their wealth,

“We often see that for entrepreneurs and business owners, passion can drive their involvement in philanthropy.

“This group of individuals tend to apply the same business acumen, energy and drive that have seen them become successful in their endeavours to their chosen causes.

“For those who have inherited their wealth, however, philanthropy often comes out of a sense of duty and responsibility handed down by previous generations.

“Therefore, maintaining that legacy is important to them in their charitable giving.”