The three most common routes to becoming rich in the UK
if you didn’t see it, the Sunday Times produced a hedge fund rich list this weekend.
The usual names were much in evidence. The richest UK hedge fund manager was deemed to be Alan Howard of Brevan Howard, with a putative fortune of £1.4bn, followed by David Harding of Winton Capital Management with an alleged £900m. Even the 49th richest UK hedge fund manager – the aptly named William Bollinger, a former Goldman Sachs analyst who launched Singapore-based Judico Capital – was said to be worth £100m. Moreover, the list may understate the reality – Sam Jones, hedge fund correspondent for the Financial Times, tweeted that it’s “nuts” to assume Alan Howard is only worth £1.4bn and that Chris Rokos, to whom the Sunday Times ascribed £230m, is actually a billionaire.
Nevertheless, it would be misguided to assume that working in a hedge fund is a well trodden route to riches. As we’ve pointed out on several occasions, hedge fund managers have a tendency to pay themselves and their partners exorbitantly well and to pay their staff handsomely, but not enormously so.
Instead, the full Sunday Times rich list – produced in May this year – indicates three key routes to immense wealth in the UK: property, finance (broadly defined) and construction. Each is an indictment of the development of the British economy since the 1980s. Notably, you are more likely to achieve riches as a pop star than as a hedge fund manager.
Does the high proportion of finance multi-millionaires on the rich list imply that you should work in investment banking if extreme wealth is your aim? Not necessarily. Although the list is littered with ex-Goldman partners, most of the extremely wealthy financiers have set up their own businesses and/or inherited money. Take Nat Rothschild, whose career hasn’t been going too well recently: in May he was deemed the second most prosperous financier by the Sunday Times, with wealth of £1bn. You won't achieve that through bonuses.
