PHILADELPHIA ( MainStreet) -- The meaning of high net worth? It depends. It's not the meaning of "net worth" that creates the variations, though; it's the meaning of the word "high."The term, in its fullest expression, is high net worth individual. It's generally a description of people with money, property and other assets that greatly exceed their level of debt. But the exact amount of money that makes someone a high net worth individual varies by bank, investment adviser, marketing department, and the Securities Exchange Commission. The SEC uses the measurement of net worth of $1 million or more as one of many measures to define the phrase "accredited investor." Financial companies may offer services that are exempt from certain SEC rules to accredited investors and that, all by itself, creates a market segment. High net worth individual is a market segment. Financial institutions of all types want to quantify the size of the market of people with investable assets. So the amount of net worth ascribed to a high net worth individual does not always include a primary residence, art, jewelry or any other asset that is not readily converted to cash. The marketing department's interest is typical:
- How big is the market? How many individuals? How many families?
- What services would be of interest and value to this market segment?
- How do we find them so that we may query them and learn of their interests?
- How do we communicate with them to sell our services?