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Millennials, Gen X, and baby boomers all have something in common when it comes to wealth.
- Millennials, Gen X, and baby boomers all view wealth as a means of peace of mind, happiness, and financial capital, reveals Boston Private's 2018 "The Why of Wealth" report.
- However, millennials place significantly more emphasis on wealth as a means of power and influence.
- Males seek forms of external and reputational wealth, while females place more value on inner emotional wealth.
Turns out, millennials, Gen X, and baby boomers have something in common - at least, the rich ones do.
High-net-worth individuals of all three generations predominately regard wealth as peace of mind and happiness, according to Boston Private's 2018 "The Why of Wealth" report, which surveyed respondents with net investable assets between $1 million and $20 million.
Of the respondents, 63% equate wealth with a peace of mind, while 54% define it as happiness (multiple answers were allowed). "In essence, individuals pursue financial wealth to achieve emotional well being," the report says, adding that this takes priority over material goals.
Even financial capital, which wasn't far behind with 51% of the vote among all generations, exemplifies how highly wealthy people value non-material goods. They are satisfied just knowing the savings and investments are there, rather than using the money to buy things, the study found.
While these are the top definitions of wealth for all generations, each generation does prioritize them a bit differently.
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All three generations perceive wealth as peace of mind, happiness, and financial capital.
Peace of mind is significantly more important to older generations, while more millennials view wealth as a "gateway to happiness," according to the report. Meanwhile, baby boomers are the only generation to place more importance on wealth as financial capital than wealth as happiness.
"While people predominantly pursue wealth to attain positive emotions and a healthy state of mind, an individual's life stage and professional status help determine the specific type of emotion they crave," the report says. Those who are older look at wealth from a security viewpoint, associating it with peace, tranquility, and contentment. Younger people are after a "more ambiguous concept of happiness," associating wealth with success and fulfillment at work and outside of work.
This may also explain why millennials have one striking difference when it comes to their perception of wealth - 46% define it as power and influence, compared to the 26% of Gen X and 12% of baby boomers who see it through the same lens. The report calls this "external/reputational wealth," a departure from "inner well-being," but yet another example of emotional wealth.
But this difference isn't just highlighted among generations - it's also evident when comparing genders.
Men seek forms of external wealth, like success, power, and influence
The study found that 28% of males valued power and influence, compared to 20% of females. Males also valued other forms of external/reputational wealth, such as success in life, affluence, and legacy, more so than females, who found more significance in inner emotional wealth, the study found.
"This indicated that men are more preoccupied with the perception of wealth and how it can elevate their social standing and strengthen their sphere of influence," the report says.
It's interesting to note that more individuals than not said their definition of wealth has evolved over time, suggesting that ideas of wealth could change as one ages, supporting the notion that life stage factors into how a person values wealth.
Perhaps over time, millennials will place more emphasis on viewing wealth as peace of mind and less emphasis on seeing it as a means of power and influence.