What’s the Real Meaning of 'Wealth?'
Several years ago, I was retained by an affluent family to help them with their long-term interactive
brokers planning.
We started the engagement with a day-long “discovery” session for the extended family at the
matriarch and patriarch’s home. When we broke for lunch, food was removed from the warm oven and
placed on the buffet table so we could help ourselves. But first the matriarch carefully removed the
tinfoil from the casseroles, wiped it with a damp cloth, folded it neatly and put it back in a kitchen
drawer so it could be reused.interactive brokers
The family’s $50 million net worth did little to change the ingrained thriftiness of the matriarch who had
grown up in an impoverished town after the Great Depression. She always believed that a nickel’s worth
of foil wasn’t something to be wasted.interactive brokers
The terms “wealth,” “prosperity” and “abundance” are often used interchangeably, but they’re not
similar at all, especially during these challenging times. Popular phrases such as “prosperity
consciousness,” “abundance mentality” and “wealth is more than money” only add to the confusion.
What’s the Difference?
Let’s take a closer look at the distinctions among wealth, prosperity and abundance:
Wealth. For most of us, wealth is broadly defined as assets minus liabilities (that is, net worth). As
advisors, we do our best to re-frame wealth as “more than money,” but the public generally sees wealth
as money or financial assets. The more you have, the wealthier you are. It’s tangible, or at least
measurable by some standard of comparison.
Prosperity. While prosperity and wealth are often used interchangeably, prosperity seems a little more
expansive. It often factors in health and happiness as well as one’s financial well-being. For instance, we
all know clients who are extremely wealthy but also unhappy most of the time. Think Ebenezer Scrooge.
Therefore, clients can be wealthy but not prosperous. Prosperity takes more of the holistic view of life;
it’s not just about one’s finances.interactive brokers
Abundance is more about contentment. It’s a feeling of plenty, with the peace of mind that there’s
enough for everyone. When an individual, family or society has a sense of abundance, there’s usually
less competition for a limited amount of resources. If someone has more than you do, the only way for
you to gain is to take from someone else. But that’s not necessary when you have a sense of abundance.
Abundance is the key to collaboration and partnership. It’s a sense of win-win, not win-lose. More easily
said than done when it comes to family dynamics, however.
Wait, here’s a wild card …