Australia's median wealth has fallen by nearly 7% since 2020, even as the country's richest individuals have grown significantly wealthier, according to a new global wealth report from Swiss bank UBS. The report highlights a growing divide between the wealthiest Australians and the broader population, with average personal net wealth climbing by 19% over the same period after accounting for inflation.
Record millionaire growth masks median decline
The UBS global wealth report described 2025 as "an extraordinary year," with close to a million new millionaires created worldwide—a record single-year increase. In Australia, more than 25,000 people became millionaires last year alone. However, the report warned that the "gains were uneven."
"While average wealth rose notably, median wealth actually declined in most markets, highlighting a growing divide between the wealthiest and the broader population," the report stated. The median provides a better measure of "typical" wealth levels, while the average can be skewed by a small group of very wealthy individuals.
Australia's median wealth ranks third globally
Despite the decline, Australian adults still have the third-highest median net wealth in the world at nearly US$211,000 (A$306,000), behind only Luxembourg and Belgium. This is largely due to property wealth and compulsory superannuation. In contrast, the United States, which has the second-highest average wealth behind Switzerland, ranks 28th out of 30 countries by median wealth.
Housing drives wealth inequality
Independent economist Saul Eslake said that while "Australia hasn't experienced as much widening in income inequality as quite a lot of other similar countries, we have had big increases in wealth inequality." He identified housing as the biggest driver of wealth inequality. Australia's progressive income tax and transfer system helps flatten income inequality, but Eslake argued that "our tax system does very little at all to ameliorate the market forces driving increased inequality in the distribution of wealth."
Global trends: median wealth falls in many countries
Australia is not alone in experiencing declining median wealth. Over the past six years, median wealth has fallen in 18 of the 29 countries analyzed by UBS, including roughly 20% declines in Germany, the United States, and the United Kingdom. In contrast, median wealth in the 2020s has jumped by 50% in Japan, 20% in India, and more than 10% in South Korea.
Call for inheritance tax to address inequality
Eslake is among a handful of economists calling for an inheritance tax, arguing that the case is compelling given that "about $5.5 trillion of wealth will be passed from boomers to their kids over the next 25-30 years, and most of those 'kids' will be in their 50s and 60s when they get it." He suggested that taxing estates of $5 million or $10 million, with exemptions for surviving spouses or partners, could help address inequality. He also proposed replacing stamp duty on property transactions with a broadly based land tax.
Impact on economic growth
Eslake noted that it is "contested territory" whether high and rising inequality is technically bad for economies. However, he said there is a growing consensus among major international bodies such as the IMF and the OECD that "beyond some point widening inequality detracts from economic growth." He explained that wealthy people save more and therefore do not add as much to growth, and that populist policies, which are often bad for economic growth, can be a reaction to widening inequality.
