How exactly does wealth change a person, to begin with? For one, a shift occurs in how they perceive risk, according to wealth advisor Robert Cannon, MBA, AIFA.
“When you have ample resources, you're going to look at a setback as a temporary hurdle instead of a crisis,” Cannon told Bored Panda, adding that losing out on an investment or taking career gambles doesn’t feel as threatening for rich people because they know they have a “reserve” to fall back on.
Cambridge Therapy Centre clinical psychologist Christine Schneirder says money changes a person’s daily reference points. As she explained, with more money comes more freedom of choice, particularly with deciding where to live and how to spend time.
“Over time, this difference in perspective can create a gap in empathy, because what feels like a small decision for one person might be a life-changing risk for another,” Schneider said.
We often hear people refer to money as “the root of all evil.” However, Schneider says money isn’t the sole cause of the shift in people’s behavior and outlook on the world. It’s also due to the change in their social environment.
In the same way, people who aren’t well-off but spend time among wealthy individuals tend to measure themselves against those around them. Schneider says this may cause the non-wealthy person to want to “keep up” by overspending, while dealing with self-doubt or having a distorted sense of what is “normal.”
Santa Clara University psychology professor Thomas Plante also brought up the social comparison theory. According to him, being surrounded by wealthy folks may make an individual feel poorer.
As an example, Plante told a story about a neighbor of his who fell into a depression after selling his company for two million dollars. His sadness came over him after learning about his brother-in-law selling his company for $60 million.
This is where the security of oneself plays a role. According to Schneider, people who feel assured of themselves may feel more ambitious and broaden their horizons, inspired by the wealthy people around them.
“The impact depends less on money itself and more on how much value and self-worth someone ties to financial status,” she said.
