Rising fast, the cost of being posh

IT’S not cheap being posh – and it looks like it’s getting even more pricey.

Research reveals the cost of maintaining a luxury lifestyle is rising by more than twice the rate of inflation.

Prices for the likes of exotic holidays, Savile Row suits and private schools are soaring by 5.5 per cent a year.

That compares with the official 2.4 per cent annual inflation that the government uses based on everyday groceries, household bills, fuel prices and other cost of living expenses.

The ‘Luxury Price Index’ from private bank Coutts shows the rich will have to dip deeper to afford the finer things in life. Like everyone else, they have been hit by fuel rises and that is particularly expensive for those who take several holidays a year or drive gas-guzzling Rollers.

Coutts looks at the basket of 142 items the government uses to work out the Consumer Price Index and then swaps them for high-end alternatives.

For instance, where the Government’s basket includes high street retailers for clothes or gadgets, the Luxury Index will look at the annual price rise at Savile Row tailors or for top mobile phones.

Footwear and clothing for those with more expensive tastes rose by 6 per cent in the past 12 months and the likes of fine wines and spirits by almost 10 per cent, said Coutts.

Sven Balzer, head of investment strategy at Coutts, said wealthier Britons needed to invest more to make sure their money continued to increase at a faster rate than luxury inflation.

He said: ‘Inflation in luxury goods is still much higher than the average return on cash, and is likely to remain so for the foreseeable future. While cash has its place in a portfolio – it has low risk and is usually easy to access in the short term – anyone looking to maintain the spending power of their wealth in the long term should consider a diversified investment portfolio alongside cash holdings.’