High-Net-Worth Individual (HNI) – Meaning, Types, and More

Open DBS Treasures Account

In a society, high-net-worth individuals (HNIs) are revered for their affluence and status, sparking curiosity about who HNIs are, how they are categorized and how they manage their wealth. In this article, we will cover what it means to be a High-Net Worth Individual (HNI) and how they manage their wealth.

What is a High-Net-Worth Individual (HNI)?

A high net-worth individual (HNI) in India refers to someone who has an investible surplus of more than INR 5 Crore. They are measured by their net worth in the financial industry. Generally, HNIs are widely defined as people whose investible assets such as bonds and stocks exceed a certain amount.

Their net worth is estimated from the liquid assets they hold like money held in brokerage accounts or banks, while excluding assets like a primary residence, durable goods or collectibles.

Types of High-Net-Worth Individuals

Three categories of high-net-worth individuals are considered based on their total net worth:

1. High Net Worth Individuals (HNWIs): Individual investors holding liquid assets of up to INR 5 crore fall under this category.
2. Very High Net Worth Individuals (VHNWIs): Individual investors with a net worth between INR 5 crore and INR 25 crore are considered very high-net-worth individuals.
3. Ultra-High Net Worth Individuals (UHNWIs): Individuals with a net worth above INR 25 crore are considered ultra-high-net-worth individuals.

Also Read: Types of Mutual Funds: A Complete Guide for Indian Investors

Classification by SEBI

The Securities and Exchange Board of India (SEBI) classifies Non-Institutional Investors (NIIs), which often include high-net-worth individuals (HNIs), into two categories based on their investment amount:

1. Small NII: Individual investors (including HNIs) investing between INR 2 lakh and INR 10 lakh fall under this category.
2. Big NII: Individual investors investing more than INR 10 lakh are classified as Big NIIs

Examples of High-Net-Worth Individuals

India has a growing population of High-Net-Worth Individuals across sectors. Here are some representative examples:

• Startup Founders: Entrepreneurs who have reached HNWI status through startup growth and equity gains.
• Business Families: Members of industrialist families often qualify as HNWIs through generational wealth and business holdings.
• Professional Executives: Top-level executives (though based abroad) that are of Indian origin and fall into the HNWI or ultra-HNWI category due to their compensation and stock holdings.
• Entertainment & Sports Figures: Celebrities who have diversified their earnings through endorsements, production ventures, and investments, placing them firmly in the HNWI bracket.
• Real Estate Investors: Individuals who have built significant wealth through real estate development or high-value property portfolios in cities like Mumbai, Delhi, or Bengaluru also fall into this category.

High net worth individuals in India come from diverse backgrounds but share a focus on building wealth through business, investing, or high-income careers. A DBS Treasures premium savings account offers them personalised banking, global investments, and expert wealth management.

Open DBS Treasures Account

Growth of HNIs in India

With increasing wealth and widening portfolios, HNIs in India have been growing in the past few years. A few statistics from previous years are as follows: 

• In terms of the number of ultra-high net worth individuals, India comes in third place in Asia and sixth overall, behind only China and Japan.
• In the past year, the number of UHNIs living in India reached 13,600 in 2024, with the total number standing at 8,50,000 HNIs, with 20 per cent of them being under the age of 40.
• The HNIs belong to mostly manufacturing, real estate, stock market equities, tech and startup fields.

Privileges and Benefits of Being an HNI

HNIs have access to a variety of exclusive financial and lifestyle services and benefits:

1. Personalized Wealth Management

   HNIs receive bespoke financial advisory services such as wealth management services to manage their wealth. For instance, DBS Treasures wealth management service provides sophisticated end-to-end wealth solutions.

2. Exclusive Investment Access

   Opportunities to invest in private equity, REITs and structured products.

3. Premium Banking Services

   Dedicated managers, better loan terms, and elite credit cards.

4. Lifestyle Perks

   Luxury travel, health programs, and exclusive event invitations.

5. Philanthropy

   Support for social impact investing and charitable endeavours.

How Do HNIs Manage Their Wealth?

HNIs in India follow a focused, diversified strategy to grow and protect their wealth. Most aim for steady returns (12–15% annually) and invest across asset classes beyond traditional stocks and mutual funds.

Their investment approach includes:

• Portfolio Management Services (PMS): Customised investments for mutual fund portfolios with professional oversight.
• Alternative Investment Funds (AIFs): Exposure to private equity, venture capital, and hedge funds.
• Real Estate & REITs: High-value properties and income-generating real estate.
• Tax-Free Bonds: Government-backed options offering steady, tax-exempt income.
• Global Diversification: International equities, bonds, or property via the Liberalised Remittance Scheme (LRS).
• Structured Products: Tailored instruments that blend fixed income and market-linked returns.

By diversifying smartly and working with expert advisors, HNIs balance risk, returns, and long-term goals.

Also Read: Role of an Investment Manager to help achieve Financial Goal

Tips to Become an HNI

Becoming a high net worth individual takes focus and smart execution:

• Track income and spending closely. Save aggressively and cut waste.
• Invest in growth assets like stocks, real estate, and private businesses. Spread risk across categories.
• Use tools like remittance services and letters of credit to manage large transactions securely.
• Set up the right structures for tax efficiency and legal protection. Get expert advice.
• Review your portfolio often. Stay sharp on market trends. Act with purpose.           

Key Challenges and Risks Faced by HNIs

Growing wealth for high-net-worth individuals comes with new responsibilities and risks that must be managed carefully. Some common challenges include:

• Lack of Financial Structure
  High income without clear systems leads to inefficiencies. Missed audits and unclear goals can result in costly mistakes over time.
• Lifestyle Overreach
  Increased earnings often lead to increased spending. Luxury purchases can limit your ability to reinvest or preserve capital for future growth.
• Security Vulnerabilities
  With greater financial visibility comes higher risk. Use strong authentication and monitor transactions regularly, especially with tools like SWIFT and foreign exchange.
• Emotional Decision-Making
  Large sums can trigger fear or overconfidence. A well-defined plan helps temper emotional reactions and supports consistent, logical choices.

Countries with the Most High-Net-Worth Individuals

The world has over 3,000 billionaires across 78 countries, but most of them live in just a few places.

• The United States dominates with 902 billionaires worth $6.8 trillion combined. Elon Musk is the richest at $342 billion.
• China comes second with 450 billionaires ($1.7 trillion total). Zhang Yiming, who founded TikTok's parent company, leads China with $65.5 billion.
• The UHNIs in India have been growing steadily with 205 billionaires worth nearly $1 trillion together residing in the country. Mukesh Ambani tops India's list at $92.5 billion.

The rest of the top 10:

• Germany: 171 billionaires, $793 billion total
• Russia: 140 billionaires, $580 billion total
• Canada: 76 billionaires, $359 billion total
• Italy: 74 billionaires, $339 billion total
• Hong Kong: 66 billionaires, $335 billion total
• Brazil: 56 billionaires, $212 billion total
• United Kingdom: 55 billionaires, $238 billion total

Just three countries – the US, China, and India, have more than half of all billionaires. About 73% of billionaires live in only nine countries in total.

Open DBS Treasures Account

Conclusion

India’s population of high-net-worth individuals is expanding rapidly, driven by entrepreneurship, global exposure, and diversified investment habits. But building and preserving significant wealth requires more than just income. It calls for insight, structure, and trusted financial partners.

Disclaimer: This article is for informational purposes only and does not constitute financial advice.