The changing perceptions of wealth.  Notably, most of us would describe those who earn a six-figure sum as ‘wealthy’.  Meanwhile, the average salary in the UK is just under £35,000 a year.

But HSBC’s recent report, ‘Your Money’s Worth: Defining Wealth in 2025’.  Notably, this highlights that only 1 in 10 people earning £100,000 or more would see themselves as wealthy.

Perceptions

Moreover, there are many reasons why high earners may not feel wealthy. For example, high inflation, taxes, pressure to ‘keep up with the Joneses’ etc.

Furthermore, the research confirmed that the more people earn, the more they tend to spend.  Some of the spend will be discretionary.  For example, they ‘need’ an extra holiday or have another property.  But some of it is not. If you live in London, the cost of renting or paying your mortgage is so much higher. Also, the ‘cost of living’ is so much higher too.

Ultimately, there is a changing perception of wealth. Particularly, among the younger generation.  Notably, it is not just defined by salary and investments alone.

“It’s about having the freedom to work anywhere you want and travelling the world.  It’s more about your health and wellness”

Hence, it’s important to know that this generation has a very different take on “what wealth is”.

The psychology of wealth:

“Concerns about money stem from primal fears of survival. While concerns about wealth stem from aspiration and social standing”

The research concluded that there are changes in what people are willing to pay for. Such as some financial services that historically haven’t been seen as important.  Examples include virtual legal guidance. As well as details showing how paying a bit more off a mortgage each month would impact their finances.

The changing perceptions of wealth. For help with your financial planning, contact us today on 01603-957599 for your free initial consultation.