Based upon the financial stability, classification of conduct is done. Certainly, how much a person is earning decides his social status. Depending upon his social status, finance experts used to classify people. 

Among them, one of the most important parts of such classification is High-Net-Worth Individual (HNWI). From the very term, it is not difficult to understand that they are such people who possess great financial stability. For wealth management institutions, these people leave a great impact. 

Who is HNWI?

Depending on the net asset of a person, finance experts used to classify people in a different categories. When it comes to HNWI, it clearly hints at those people who have more than one million assets. Such a huge asset is definitely a mix of liquid cash, stocks, shares, bonds, CDs etc. 

It is not difficult to understand that these people included under this category are majorly the investors who do not work to earn money. Rather they want their money to work for them. Perhaps, it may sound like a riddle, but nothing is confusing as this is the procedure that every HNIW follows. 

As a result, earning more than 780000 pounds is not at all impossible. Moreover, these HNIWs lead a composed financial life, and they always adhere to the advice of wealth managers. Besides, they have good investment knowledge to evaluate the process better before taking each and every step. HNWIs are even good at evaluating Return on Investment (ROI).

Different types of HNWI 

Nowadays, it has been observed that there is the necessity of subdivisions while describing HNWI. This is because increasing earning band of those people. In past days, while the income of high net worth people used to limit to between 1 million, only one classification was enough to describe their net worth. But by observing the increasing income range, financial experts used to bring several other HNWI. 

Basically, they have differentiated such HNWIs into two other divisions as per their income range. By dividing them into different tires, financial experts used to bring out two more HNWI types. These are, 

1.HNWI: Investors whose total asset value does not cross the limit of 5 million euros. Generally, these people come under the common High-Net-Worth Individuals whose total asset value is usually 1 million Euros. 

 2.Mid-tire HNWI: This type of investor does not fall under the limitation of 5 million euros. Rather the minimum value of their net asset begins from 5 million. Meanwhile, it can go up to 30 million Euros. Therefore, you may understand how much difference is there from common HNWI. Naturally, these mid tire HNWIs are not only investors, but also they are large business tycoons. 

3.Ultra HNWI: From the very term, it is not difficult to understand that such type of High-Net-Worth Individuals tops the list of these people. Apart from assets, these types of individuals have liquid assets worth 30 million pounds. Therefore, it is quite understandable that how much one needs to have to become an ultra HNWI. Apart from having such a huge amount of liquid money, UHNWI also has an ample investment from which he earns more money. 

So, these are three different categories of HNWI which determine their financial stability. Undoubtedly, when a wealth management firm can get any of them, it may earn a huge amount of profit range. But this factor of classification also depends upon one financial advising company to others. 

Depending upon the classification, the quality of service also varies. Moreover, not every financial advising company used to handle the assets of Ultra High Net Worth Individuals. This is because such UHNWI possess a huge range of asset classes and even the amount of liquid money is also huge. For this reason, only experts can deal with their money. 

On the other hand, some wealth management companies do not handle the entire asset amount of UHNWI. They make an agreement and handle 70% of the asset, and the rest of them leave on the individual. It is quite common that handling UHNWI clients means taking over risks. For this reason, many wealth managers would like to avoid them. 

Reasons to choose HNWI over UHNWI 

It has been observed that financial advisors and intermediaries generally like to deal with common HNWI over UHNWI. Certainly, there are so many reasons to choose a comparatively low-value High-Net-Worth Individual. 

No necessity to handle complexity 

It is quite common that a huge amount of money often leads to complex situations. Such situations are quite common for UHNWI because this type of investor possesses the bulk amount of money. Besides, they have several other shares and bonds which need to track within the frequent interval. 

Therefore, it is quite difficult to handle the funds of Ultra HNWI. On the other hand, common HNWI does not have a huge amount of funds like them. As a result, wealth managers need not struggle a lot to handle their assets. Less complexity brings ease of handling funds.

A wealth manager can shuffle money 

Generally, common HNWIs assume financial advisors as trustworthy persons. They gave the authority to handle the fund as per the suitability. For this reason, working with HNWIs is quite comfortable for finance experts. As they get full authority, they always try to invest the money to get a high-interest rate. 

UHNWI are quite snobbish 

It has been observed that UHNWI people are very snobbish, and they represent themselves as the supremo of even the financial market. In any case, if there causes any problem regarding the fund, they do not think twice to behave badly with financial advisors. 

Tips to Become a Millionaire 

After reading everything about High-Net-Worth, perhaps you may also think about how to become a millionaire? Before we tell you some tips, you need to know that this is not at all an overnight project. Rather, it will take time, and if you can plan properly, you can definitely become a millionaire in the near future. 

Borrow money for investment 

Always remember to become a millionaire. You need not become born rich. Rather people become rich by applying his tactics. Therefore, if you can only use money properly, you can become an HNWI soon.

Perhaps you do not have money to invest. In that case apply for loans for bad credit with no guarantor facility from the direct lenders. Now, invest the entire amount in high-value shares or stocks or bonds. 

Invest in the small scale business 

Apart from investing in shares, try to become the investor for any small scale business. But before investing, make sure that the business has enough possibility to flourish in future. For this reason, you must analyse the business plan. There is no doubt that money earned from a small scale business will help to earn a profit on your investment. 

Let your money work for you 

Do not think about earning money. Rather, use money so that within few years, you can also include your name under millionaire. Change the fundamentals and utilise your money to become an HNWI. 

These are some small tips that are not enough to become a millionaire. But certainly, they will work if you can make effective use of them.