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There’s a long-running belief that more money equals more happiness. However, there’s not a lot of science behind it. It’s possible and very realistic for someone in a lower income bracket to be happy.
Likewise, there are plenty of examples of people that are perceived to be rich being full of worry or downright unhappy. In other words, there are differences between “rich” and “wealthy.”
“A financially rich person might have a significant income right now while living a posh lifestyle and blowing through much of their money on material items. A wealthy individual, on the other hand, enjoys a more sustainable lifestyle made possible by the accumulation of assets and professional investment management – they could have passive income sources, as well,” according to Bogart Wealth.
Add to that, the definition of wealth has grown to encompass more than finances. Clients can feel wealthy when they believe their lives are well-lived, when they’ve made positive impacts on others and when they’re charitable, just to name a few examples. It seems more Americans are looking at wealth this way.
Happiness Is Top Priority
The KeyBank 2024 Financial Mobility Survey contains some interesting findings for advisors to ponder. Notably, almost two-thirds of those polled said they’d prefer to work at a lower-paying job as long as they’re happy compared rather than be miserable at a higher-paying gig. Other data points confirm the notion that happy, not rich, is the priority.
“Continuing a trend seen year over year, more Americans say they value work-life balance (63%) over a high-paying salary (27%), compared to 57% and 33% respectively in 2022,” according to the survey.
Advisors still need to help clients strike a delicate balance because finances are obviously a cause of stress for some, but many people are trying to get past that. It’s a matter of how that stress is eliminated.
“As Americans focus on their personal well-being, many are in favor of a ‘soft-life culture’ that defines success based on happiness, contentment, and fulfillment vs. ‘hustle culture,’ which defines success based on wealth, status, and achievement (36% and 28% respectively),” adds KeyBank.
Eliminating Stress Could Be Key to Happiness
Acknowledging that many clients want to be happy, a key element in getting them there isn’t necessarily increasing wealth, though that could help, but rather reducing and eliminating stress. That’s pertinent at a time when financial stress remains elevated.
“Nearly one third (30%) of survey respondents say they feel daily financial stress related to the cost of living in America, and more than half (59%) are cutting back on nonessential items due to the increasing cost of living. To add, more people would rather share their recent Google search history (57%) than their monthly credit card statement (43%),” notes KeyBank.
The good news for advisors is that the KeyBank poll and other related surveys suggest many clients are open to making changes to reduce financial stress and they want the help of a professional to help them achieve that goal.