This spring, millionaires felt relatively pessimistic about the economy and identified several perceived threats to personal wealth, according to CNBC’s latest millionaire survey.

Millionaires believe the biggest current threat to their wealth is the stock market, with 60% expecting the S&P 500 will be down or relatively flat by the end of 2023.

Tied for second place, respondents also worry about U.S. government dysfunction and inflation, with the majority of respondents expecting the economy to be weaker by year-end, the survey found.

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Only 7% of respondents said high taxes were the biggest threat to personal wealth.

The twice-annual survey polled more than 750 affluent individuals nationwide in April 2023. Respondents had investable assets of $1 million to $5 million or more.  

With the debt ceiling crisis in the rearview mirror, investors are shifting their focus to other economic concerns, experts say.

“We’re starting to climb that wall of worry again,” said certified financial planner Chris Mellone, partner at VLP Financial Advisors in Vienna, Virginia, referring to market resilience despite economic uncertainty.

While some clients are hesitant to put money to work amid recession fears, he urges investors to “stick to their long-term plan,” rather than keeping cash on the sidelines, he said.

The volatility index, or the VIX, is currently trending lower, below 15 as of June 5, Mellone pointed out. “It looks like if we do have a recession, it’s going to be shallow,” he said.

While inflation continues to moderate, many affluent Americans still worry about high prices.

“That’s the thing I hear the most from my clients,” said Natalie Pine, a CFP and managing partner at Briaud Financial Advisors in College Station, Texas, noting that inflation is a big concern for her clients with assets of $1 million to $5 million.

Annual inflation rose 4.9% in April, down slightly from 5% in March, the U.S. Bureau of Labor Statistics reported in May.

A significant number of millionaires, especially older investors, believe it will take one to five years for inflation to fall to the Fed’s target of 2%, the CNBC survey found. Meanwhile, some 43% of millionaires are weighing portfolio changes or plan to make adjustments due to inflation.

Matthew McKay, a CFP who also works for Briaud Financial Advisors, said investing to “keep pace with and beat inflation” is the best way to combat sticky high prices.

“We’re seeing a lot more interest in alternative assets and private deals, which can generate returns,” he said. “We do a lot in the oil and gas space, which is a big driver of inflation, so that’s a good hedge there.”