Wealth and Assets in Scotland

Aggregate total wealth of private households increased to £856.6 billion in Scotland in 2012/14. All components of wealth increased, although pension wealth continues to be the largest component of private household wealth in Scotland, accounting for 48 per cent. The increase in total wealth in 2012/14 was largely due to increases in pension wealth.

The distribution of household wealth in Scotland remained highly unequal. The wealthiest 10 per cent of households owned 43% of all private wealth in Scotland. The least wealthy 50 per cent owned just 9%. The wealthiest 1 per cent alone owned more wealth than the bottom 50 per cent of households.

The wealthiest 10 per cent of households owned 67% of financial wealth; 54% of private pension wealth; 43% of property wealth; and 34% of physical wealth. In contrast, the least wealthy half of households owned less than 2% of financial wealth; 2% of private pension wealth; 5% of property wealth; and 18% of physical wealth.

In 2012/14 wealth inequality increased in Scotland. The wealthiest 10% owned 9.4 times more household wealth than the bottom 40% of households. This is an increase from 8.8 in 2010/12. Wealth inequality in Scotland was slightly lower than that for Great Britain. However, wealth inequality in both Scotland and Great Britain remains high, with little difference in the pattern of inequality.        

The wealthiest 10 per cent had an average total wealth of £1.34 million, compared with £18,300 for the least wealthy 30% of households. Amongst the least wealthy households: more than four in five were in rented accommodation (compared to 2% of the wealthiest households); one in five had a savings account (compared with four in five of the wealthiest households); the median financial wealth was £500 (compared with £103,416 for the wealthiest households);  and more than one in ten had household arrears (compared with 1 per cent of the wealthiest households).

Background

Wealth and Assets in Scotland, 2006-2014

The Wealth & Assets Survey (WAS) is a key source of information on the economic situation of households in Great Britain. The survey focuses on household assets and debts, borrowing and saving, and plans for retirement.

WAS collates information on the following four types of wealth held by households: property wealth, physical wealth, financial wealth, and private pension wealth:

Financial wealth: the value of all financial assets minus the value of all non-mortgage borrowing.

Property wealth: the value of all property wealth minus the value of property debt (e.g. mortgage on property)

Private pension wealth: the value of wealth held in occupational pension schemes to which individuals contribute. These include Defined Benefit (DB) and Defined Contribution (DC) schemes as well as personal pensions.

Physical wealth: the value of items such as cars, and household goods like televisions, computers, and jewellery.

There are a number of methodology issues that need to be borne in mind when considering this analysis:

First, the measure of net wealth in the analysis is based on the personal, private wealth of households. It does not include business assets owned by household members, nor does it include rights to state pensions, which people accrue during their working lives and draw on in retirement.

Second, only those designated as ‘private households’ were sampled for the survey. Those in residential institutions such as retirement homes, nursing homes, prisons, and barracks or university halls of residence, and also homeless people were not included in the sample and are therefore excluded from this analysis.

Third, the Scottish sample is not fully representative of the geography of Scotland, as WAS does not sample households north of the Caledonian Canal or on the Scottish islands.

Estimates within this analysis have not been equivalised and therefore are not intended to account for differences in household size or composition.

All estimates within this report are presented as current values (i.e. the value at time of interview) and have not been adjusted for inflation.