High net-worth individuals (HNWI) continue to make short-term investment decisions when they should be thinking long-term, a leading wealth management consultant has said.
"Wealthy families should be the ultimate in long-term and yet they are not. They should be investing for the next hundred years, but the fact is they do not," Brunel Associates managing principal Jean Brunel said at a CFA Society of Sydney continuing education presentation.
"When you have enough money that you do not have to worry about your expenditures, you should be buying things that have a long fuse."
Brunel said the current environment has exacerbated the trend towards investors taking a short-term view.
"What I notice more than anything is that people have said - if I had known I would have done something different. We had been telling our families for at least a year that something in the market did not seem right," Brunel said, in regards to the continuing financial crisis.
According to Brunel, the difficulty for financial planners working with HNWIs is they often have more than one set of objectives.
"You might have a family with three generations, who all have three sets of goals each, so now you have nine," he said.
"People should be making a whole bunch of decisions on a continuing basis, rather than what is the newest idea."
Brunel spent the bulk of his career in the investment management group of J.P. Morgan.
