Sixty-five percent of well-to-do Americans in a recent survey defined “wealth” as peace of mind, while 54% defined it as happiness.
Baby boomers and Gen Xers as well as non-business owners were likelier to associate wealth with peace of mind, while millennials and business owners were more inclined to see it as a gateway to happiness, Boston Private, a provider of integrated wealth management, trust and private banking services, reported Monday.
CoreData Research conducted the online survey in February and March among 300 Americans with net investable assets between $1 million and $20 million.
“We wanted to discover what wealth really means, the emotional aspects that the investment management industry has largely overlooked,” David Murphy, head of wealth advisory at Boston Private, said in a statement. “Putting aside specific asset classes or investment decisions, we wanted to better understand the root motivations that drive people to build and achieve wealth.
Those drivers turned out to be fluid and highly nuanced, Murphy said.
Younger male business owners in the $15 million-to-$20 million bracket attached considerable importance to the concepts of affluence, potential and power/influence.
Men and women in the sample differed in several ways. The data suggest that “men are more preoccupied with the perception of wealth and how it can elevate their social standing and strengthen their sphere of influence,” according to Boston Private. Men may care less about wealth’s internal emotional benefits and more about how it can shape the way they are perceived.
Similar broad differences showed up in the results between business owners and non-business owners.
Seventy percent of respondents identified financial independence and freedom as the most important consequence of wealth. Half said wealth enabled them to have a happy family life.
More than half the respondents said thinking about their wealth triggered feelings of satisfaction, responsibility and gratitude. About a third said it made them feel excited and inspired, mainly because of future potential use and realizations of wealth.
Six in 10 Americans in the survey said their wealth priorities had changed over time, with seven in 10 saying family had been the most important driver of change.
As to what motivated them to pursue wealth, 66% of respondents cited living a comfortable life, 53% ensuring their family’s financial security, 50% financial freedom and 48% spending quality time with family and friends.
A quarter of millennials said they were motivated by achieving a better social standing, compared with 9% of the wider sample. A third of the younger respondents also placed more value each on enhancing the work-life balance, making a difference and pursuing a hobby or passion.
Respondents’ main long-term goal was to live a life of pleasure with no financial concerns, followed by providing their offspring the means to live comfortably.
The survey showed that for many respondents, regret comes with wealth. Forty-two percent said they would have spent more time with family if they had not devoted time to accumulating wealth. This regret was especially pronounced among the wealthiest individuals in the sample and business owners.
The survey also turned up negatives of wealth. Nearly a third of respondents cited people’s expectations, and similar proportions worried about losing wealth and people judging them by their status.
Sixty percent of wealthy respondents said they intended to transfer all their wealth at death. Half said they had made a wealth transfer plan, and a fifth said they were working on one.
Two-thirds characterized as informal conversations the meetings they have with their family to discuss finances. Only a fifth said they did not have family meetings or conversations about wealth management.
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