How rich people live, spend and enjoy

Prim and proper, a woman sees paintings at a gallery, holding a luxury clutch bag. Coming back home after shopping for luxury clothes at boutique shops and receiving regular massage treatment, she greets her husband who comes back from work.

This is a typical image of the so-called “daughter-in-law in Cheongdam-dong,” one of the most affluent districts in southern Seoul. Many soap operas and TV programs have described women marrying into well-off families living in the district as having such features.

Then, are those features real?

Hana Institute of Finance under the Hana Financial Group recently issued the “2013 Korean Wealth Report” in which they reviewed rich people’s asset management patterns and lifestyle. For the review, it surveyed Hana Bank’s 784 private banking clients whose financial assets were over 1 billion won and who were included in the nation’s top 0.3 percent in terms of the size of their assets.

According to the report, those rich people think the most important thing for their would-be daughter-in-law and son-in-law is their personality. Those having sons are also highly interested in their would-be daughters-in-law’s family background, while they don’t care much about whether the girls have good school careers or whether they earn a high income.

For would-be son-in-laws, they want someone who makes a high income or whose family background is good. Older people who have got their children married said they spent about 420 million won on average for marriage expenses including buying houses for the newlyweds, regardless of the children’s genders.

It is different from the general public’s spending on marriage ― according to the health and welfare ministry’s 2009 report, parents having sons spent 74 million won and those having daughters, 33 million won.

Distinguished lifestyle

The wealthy make 39.1 million won per month on average, while spending 10.1 million won. People in their 40s spend the largest money among all age groups, probably due to childcare costs including education expenses. The spending gets smaller among those in their 50s and 60s, but increases for 70-somethings, as the older generation actively enjoys leisure activities and dining out unlike their non-rich peers.

Compared to the general public, the rich spend quite a lot of money on purchasing clothes and items such as shoes or bags ― average people spent 160,000 won for clothes per month according to Statistics Korea report in 2012, while the rich people surveyed by the institute spent 1.25 million won.

Other spending categories that shows big gaps between the general public and the rich are housekeeping or nursery services, for which the former spent 10,000 won monthly and the latter, 850,000 won; and cultural and leisure activities, where the former spent 140,000 won and the latter, 850,000 won.

The wealthy work 38.8 hours per week on average, shorter hours than the general public’s 44.6 hours. Consequently, they spend longer hours with family than average people ― 3.52 hours per day on weekdays and 7.1 hours on weekends, about double the public’s 1.77 hours and 3.05 hours, respectively.

After retirement, about half of the general public in their 60s spent time for relaxation such as TV watching, napping or strolling, while another 17 percent enjoyed social activities and 16 percent, recreational activities, according to a survey by the culture ministry in 2010.

For retired rich people, 19 percent also enjoy recreational activities and 16 percent, relaxation. However, they have more varied options, with another 15 percent enjoying traveling; 14 percent, social activities; 11 percent, sports; 10 percent, cultural activities; and 10 percent, religious or volunteer activities.

Regarding private education, 94.7 percent of rich people having minor children have the children attend cram schools or receive private tutoring, much higher than average people’s 71.1 percent.

The rich spend 2.29 million won per month for private education, five-fold that of ordinary people’s, 482,000 won reported by Statistics Korea in 2012.

By: subject, 89.9 percent study English in their private education, compared with 50 percent by ordinary people. Also, 48.9 percent of rich people with children said their children are studying abroad or are considering doing so. As to the reason for overseas study, they said they wanted the children to develop foreign language skills and a global mindset.

The wealthy had a higher ratio of smartphone and tablet use than average: especially among those in their 70s, 46 percent of them had smart devices, while the ratio of their non-rich peer was unavailable as they barely had them.

Asset management

When looking into their asset portfolio, 45 percent of their assets were real estate and 55 percent, financial property. The ratio of real estate has decreased since the global financial crisis in 2007-2008 due to a decrease in housing prices.

Among financial asset, deposits took up 41.7 percent, followed by funds, insurance, pension and stocks. Those people were not much interested in high-risk-high-return investments.

While they are “rich” compared to majority of the public, 70 percent of the surveyed people said they were not rich. They thought having at least 10 billion won is the minimum qualification to be called “rich.”