For middle class millionaires today, there remains a solid commitment to traditional middle class values such as a responsibility to family. This takes many forms. For example, middle class millionaires are one of the driving forces behind the explosive growth of concierge medicine. The advantages provided by this, such as quicker access to health care, are something many middle class millionaires are quite willing to pay for.

Middle class millionaires tend to see college and professional schools as the appropriate path for their children. What they don’t want to do is saddle their children with debt from paying for their own educations. Consequently, they’re often very willing to shoulder the debt instead.

Middle class millionaires continue to be incredibly achievement-oriented. They were, and many still are, (fair to say) obsessed with digging themselves out of the hole they dug for themselves at the end of Act I. Meanwhile, the middle class millionaires who skipped the first act have often learned by close observation to avoid the mistakes of being overconfident by believing that their future earning power will only increase along with their investments.

The mind-set and behaviors that are regularly essential to creating substantial personal wealth have not changed (in centuries) and remain critical to the ability of these people to resurrect their fortunes or create new ones. We refer to this as “millionaire intelligence,” exemplified by their:

• Commitment to personal wealth creation;

• Concentration of efforts on high-return endeavors such as business ownership;

• Willingness to compensate everyone involved who helps them build their fortunes;

• Focus on strengths and readiness to delegate those things they are weak at; and

• Strategic approach to networking to create relationships that produce money instead of only friendships.

One of the key differences between middle class millionaires today and those of about a decade ago is their sense of caution when it comes to their financial lives. There is a strong consensus that everything does not continue to increase in value. Even with the stock market’s breathtaking ascent, middle class millionaires have firsthand experience with the aftereffects of bubbles bursting. And they know that when some asset bubbles burst, such as those in real estate, the values do not come back for a long, long time.

There is greater self-reliance than before, and this is from a very self-reliant cohort. A sizable percentage of Act I middle class millionaires said to themselves something along the lines of, “If this doesn’t work (a major investment for instance), I still have the time to recoup.” For them, now is that time. They will not get another chance, and they are looking—with deteriorating bodies making it harder to work the long hours—to come back (cue Survivor: “Eye of the Tiger” for the last time).

Special Feature: Implications For Financial Advisors
Their very personal experiences, with the meltdown feeding their sense of caution, translate into the ways they are likely to work with financial advisors. Trust in Wall Street (the symbol) as well as in financial advisors (the professionals on the ground) is and, in many cases, will remain somewhat strained. This results in middle class millionaires diversifying among financial advisors and in running some of the investments themselves. They are also experimenting with robo-advisors and are, for the most part, finding them worthwhile for some of their investable wealth. Now they have a way to make honest comparisons.

The influence of affluence phenomenon is still strong and, in some cases, because of social media, even stronger. Middle class millionaires, however, are less inclined to refer their connections to financial advisors or other providers. This limits the blowback, which they more readily see as possible, if their recommendations do not pan out. Still, there are methodologies that financial advisors can employ to effectively leverage the powerful networks middle class millionaires have and that offer a steady stream of high-quality referrals. One big difference is that the onus is, for the most part, completely on the financial advisor.

With the middle class millionaire making a comeback, failing to connect and work with them will likely result in many financial advisors being marginalized and even a percentage of them exiting the business. On the other hand, for those financial advisors who are able to meaningfully connect and work with them, middle class millionaires will likely be very important clients in an increasingly hyper-competitive environment (cue Queen: “We Are the Champions.”)


Russ Alan Prince is president of R.A. Prince & Associates Inc. and executive director of Private Wealth magazine.

Brett Van Bortel is director of consulting services for Invesco Consulting, the sales consulting group within Invesco Distributions Inc. The opinions expressed are those of Russ Alan Prince and Brett Van Bortel, and are based on current market conditions and subject to change without notice. These opinions may differ from those of other Invesco investment professionals.

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