Even Millionaires are Using Budgets.
Posted: September 22nd, 2009 | Author: Joe | Filed under: Saving, spending | Tags: Budgeting, Economy, Opinion, Wealthy | 1 Comment »According to a recent NYT article:
“Someone with $100 million has nothing to fear, not even fear itself.
But not long ago, a client with such assets called and asked Bruce Bickel, her wealth adviser at PNC Wealth Management, to put her on a budget.”
Millionaires on budgets? What’s This world Coming to?
According to The Boston Consulting Group, worldwide wealth is not expected to return to 2007 levels until 2013 – and the number of millionaires is down 18%. All this has created a crisis in confidence for the wealthy. So much so that they are not only cutting back, but changing their behavior to make the cut backs a way of life.
I guess it’s a good thing, I just wish I had enough money to not know where it’s going and still make ends meet. But then again, my frugal nature would still make me watch my dollars and cents. 
But while budgeting is generally a good thing, in this case it could have a trickle down effect, and lead to a generally tepid economy:
“Caution, like thrift, can be detrimental to an economy in crisis. If wealthy investors steer clear of stocks for the medium term, the trading rally of the last few months could slow. If they are afraid to lock up their capital for the longer term, private equity partnerships and hedge funds could suffer. And if wealthier people eschew the heavy debt load they had recently embraced, their savings may increase but the banks that had eagerly lent to them will feel the effect. And this will then affect less-affluent investors.”
With the world suffering from a global economic financial crunch, it is not new that people who even has a huge trust fund and on budget mode.
Arvin