The wealthy: A financial psychological profile.

Abstract

Drawing from the theories of money ambivalence, cognitive dissonance, envy, and relative deprivation, this study sought to explore stereotypes of the wealthy. Specfically, it examined the financial psychology, demographics, and financial behaviors of a sample of wealthy individuals and a sample of other relatively high-income and high-net-worth individuals, and it compared these characteristics to see what, if any, differences exist. Results show that wealthy individuals exhibited significant psychological differences, including lower levels of money avoidance, loss aversion, and financial stress; higher levels of life and financial satisfaction, financial knowledge, internal locus of control; and a fundamental drive to follow their passions and increase their wealth. With regard to financial behaviors, the wealthy spent significantly more on their most recent purchases but were not more likely to be financially dependent on nonwork income and were not more reclusive. A deeper understanding of the wealthy can help mental-health providers better serve this population and help individuals aspiring to increase their income and net worth by challenging inaccurate beliefs about this population’s psychology and financial behaviors.