The exceptionally wealthy tend to share five core characteristics. Other less affluent individuals can of course share these characteristics. However, the five characteristics tend to be very much in evidence with people of immense wealth and advisors need to be aware of them:
Complex Lives: Greater wealth often adds complications to people’s lives. Tax issues play a much more important role than they do for the less affluent. Estate and gift taxes, for example, are a big consideration for the exceptionally wealthy and a much smaller issue—if an issue at all—for those less affluent. Family and personal relationships can also be dramatically complicated by money, and meaningful sums of money can often magnify eccentricities and animosities.
Desire For Control: Money and power walk hand in hand. The exceptionally wealthy often try to influence or control just about every significant situation in their lives. While people of all wealth levels can have control issues, rich people have the resources to fulfill their desire to exert their will on the world at large or at least on their personal corner of the world. This tendency can often be seen in the way the exceptionally wealthy structure their wealth; it communicates what they think of themselves and those around them.
Vast Connections: The ability to reach out and influence is a function of the connections the super-rich have with important people. These connections are a product of their financial success, their social circle (which is also often a function of their financial success) and most importantly, the professional networks they employ.
In the case of the exceptionally wealthy, we’re rarely talking about “six degrees of separation.” Their relationships are typically closer. One exceptionally wealthy family has had its connections diagramed and found that it could access 91.3 percent of its local political and business leaders and 61.1 percent of Beltway politicians with no more than three degrees of separation.
Abundant Capital: How exceptionally wealthy people use their money to define themselves is what’s important—not the mere fact that they have the wealth in the first place. Capital is the psychological persona of the exceptionally wealthy, reflecting the way they use their money to deal with the complexities of their lives, their desire for control over their environment and the connections they can leverage.
The psychological importance of capital is seen in the strong desire by most of the exceptionally wealthy to preserve their wealth. Many of them will only concentrate on wealth building when they’re secure that their fortunes are protected.
Charitable Intentions: For many, but not all of the exceptionally wealthy, doing good is the correct course of action. By and large, the exceptionally wealthy are not charitable simply for the tax benefits.
Similar tax benefits can be achieved without having to give away assets. Many of the exceptionally wealthy are charitably inclined because they’re earnestly looking for ways to make the world a better place. While their motivations are usually pure, this doesn’t mean they wouldn’t mind maximizing their personal financial situation while being caring.
For professionals wanting to build a substantial business with the exceptionally wealthy, it’s imperative that they have a deep understanding of them as a cohort and as individuals.