SOURCE: Spectrem Group

December 08, 2010 08:00 ET

Recession Concerns Linger for Mass Affluent Investors

40% Are Likely to Invest in Cash Over Next 12 Months, While Just 23% Plan to Purchase Equities; Protecting Principal Is Top Priority

CHICAGO, IL--(Marketwire - December 8, 2010) - For mass affluent investors, the recession isn't quite over.

Even though the economy is recovering, cash represents the No. 1 investment choice for the mass affluent over the next 12 months, according to "Mass Affluent Investor 2010," a new report released today by Spectrem Group ( The mass affluent, those with a net worth of $100,000 to $1 million not including primary residence (NIPR), represent more than 26 million U.S. households.

A full 40% of mass affluent investors say they are likely to invest in cash over the next 12 months, considerably more than the 23% likely to purchase equities or the 17% likely to buy fixed income products. Other choices include international investments (12%) and investment real estate (6%).

"Although the economy has been recovering for some time now, the nation's mass affluent have not shaken off their recession-driven caution when it comes to investment decisions. Rather than return to equities or even bonds, this large and important group favors cash over the next 12 months, reflecting real concerns about having enough savings to last through retirement and the ability protect their principal from further risk," said George H. Walper, Jr., president of Spectrem Group.

Indeed, more than half (55%) of mass affluent households believe it is more important to protect principal than to grow investments.

Spectrem's report, "Mass Affluent Investor 2010," is based on a survey of the financial decision-makers in 1,511 households with a net worth of $100,000 to $1 million, NIPR, conducted online in September 2010. The data have a margin of error of plus or minus 2.4 percentage points. 

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