Every country has its own unique characteristics and even though many people tend to think that High Net Worth (HNW) investors are the same the world over. They are in fact quite different. So we decided to look at a recent report of HNW investors in Indonesia. This is critical information if you’re a wealth manager or entrepreneur wishing to raise money. Further it’s good to note because financial institutions and luxury goods companies rely on HNW consumers.

HNW investors of Indonesia have predominately accumulated their wealth through business interests, with property and manufacturing key wealth generators. Investors show strong demand for advisory mandates, but a significant proportion of wealth remains unmanaged. Defensive investments dominate the average portfolio, and while this is not expected to change we do forecast a decrease in demand for cash, while demand for fixed income is expected to rise. Tax planning is most sought after, but demand for pension and financial planning is on the rise.

Critical success factors in HNW Investors market
– Capitalize on the untapped potential: A large pot of Indonesian HNW wealth remains unmanaged. An excellent track record, a wide range of financial products, and a focus on the convenience aspect of professional advice will be key to seizing this opportunity.
– Match the growing demand for tax planning: Indonesia’s tax amnesty is driving demand for tax planning in the country. Wealth managers lacking in-house expertise should consider partnerships.
– Build up a strong corporate offering: A significant proportion of HNW wealth continues to be self-directed; with the main reason being the noteworthy proportion of investments is non-financial assets, such as HNW investors’ own business ventures. Wealth managers with a strong corporate offering will be able to get their hands on these assets.

Key points to note 
– Indonesian HNW individuals tend to be older than their regional peers.
– The expat opportunity is less developed than in Asia Pacific, but wealth managers reaching out to HNW expats from South Korea or Singapore will find them to be a lucrative target market.
– The country’s HNW investors engage multiple wealth management firms, which is symptomatic of a relatively underdeveloped and risk-averse wealth market.
– A lack of expertise and time are the top drivers for Indonesian HNW investors to seek professional advice, while non-financial investments are the main reason they self-direct.
– HNW demand for equity, fixed income, and alternatives is forecast to rise over the next 12 months, while demand for cash and near-cash products is expected to decrease.
– A multi-service strategy – encompassing tax, financial, and pension planning – is becoming increasingly important as demand for these services is on the rise.
– Indonesian HNW individuals tend to be older than their regional peers.
– The expat opportunity is less developed than in Asia Pacific, but wealth managers reaching out to HNW expats from South Korea or Singapore will find them to be a lucrative target market.
– The country’s HNW investors engage multiple wealth management firms, which is symptomatic of a relatively underdeveloped and risk-averse wealth market.
– A lack of expertise and time are the top drivers for Indonesian HNW investors to seek professional advice, while non-financial investments are the main reason they self-direct.
– HNW demand for equity, fixed income, and alternatives is forecast to rise over the next 12 months, while demand for cash and near-cash products is expected to decrease.
– A multi-service strategy – encompassing tax, financial, and pension planning – is becoming increasingly important as demand for these services is on the rise.