The Paradox of Prosperity: Why Even High Earners Don’t Feel Rich
Table of Contents
- 1. The Paradox of Prosperity: Why Even High Earners Don’t Feel Rich
- 2. How does the hedonic treadmill contribute to the paradox of plenty experienced by high-income Americans?
- 3. The Paradox of plenty: Why Wealth Doesn’t Equal Happiness for High-Income Americans
- 4. The Hedonic Treadmill and Rising Expectations
- 5. The Erosion of intrinsic Motivation
- 6. Social Comparison and the Status Trap
- 7. The Impact on Relationships and Social Connection
- 8. The Role of Values and Purpose
- 9. Benefits of Shifting Focus: A Happier, More Balanced Life
New York, NY – As the cost of living continues too climb, the definition of “rich” is becoming an increasingly elusive target, even for those with significant incomes. A recent Bankrate survey, released in early 2024, reveals a notable disconnect between earning power and the feeling of financial security. Americans across different income brackets consistently report needing more money to feel comfortable, with those earning over $100,000 per year estimating a need for $246,000 annually, a stark contrast to the $157,000 needed by those earning under $50,000.
This phenomenon is exemplified by Marie Incontrera, a 39-year-old entrepreneur based in Manhattan. Incontrera transitioned from a successful, albeit low-paying, career as a professional musician to launching her virtual assistant business in 2016, which she later expanded during the pandemic into a digital marketing consulting agency. Her business is projected to generate approximately $1.4 million in revenue for 2025, with an expected owner’s draw of $300,000 to $400,000 this year.
Despite this dramatic increase in income, Incontrera admits she doesn’t feel rich. “I feel very lucky. I feel privileged, but I do not feel rich,” she told CNBC.Reflecting on her earlier years, she noted, “I was making $15,000 a year” even while performing at prestigious venues like Carnegie Hall.The financial anxieties of her earlier career, she claims, have not entirely dissipated. “I have more money anxiety,almost,now than I ever did in my 20s,” she confessed.Experts attribute this sentiment to the constant “hamster wheel” of demanding careers and escalating expenses. Kamila Elliott, CEO of wealth management firm Collective Wealth Partners, explains that high earners frequently enough find their income consumed by lifestyle choices and operational costs, leaving little discretionary income.”It can be pretty easy for someone to feel like, I’m making really good money, but I don’t have a lot of discretionary income,” Elliott stated.
Elliott advises a strategic approach to financial well-being, emphasizing that a budget should reflect personal values. “The issue is you can’t value everything,” she explained. “You have to pick maybe one or two things were you’re going to focus your discretionary spending and then take that extra and reroute that to savings so you can start feeling rich.” This intentional allocation of resources, rather than simply accumulating wealth, appears to be the key to bridging the gap between earning and feeling.
The accompanying video further explores how spending habits can perpetuate this feeling of being financially stuck, even for those who achieve significant financial success.
How does the hedonic treadmill contribute to the paradox of plenty experienced by high-income Americans?
The Paradox of plenty: Why Wealth Doesn’t Equal Happiness for High-Income Americans
The Hedonic Treadmill and Rising Expectations
The idea that more money equals more happiness is deeply ingrained in American culture. Yet, numerous studies demonstrate a surprisingly weak correlation between income and overall well-being, particularly beyond a certain threshold. This phenomenon, often called the “paradox of plenty,” stems from several psychological and sociological factors. A key concept is the hedonic treadmill (or hedonic adaptation).This suggests humans quickly adapt to positive changes – like a raise or a new luxury item – and return to a relatively stable level of happiness.
Essentially, we recalibrate our expectations. What once felt like a notable betterment becomes the new normal, requiring ever-increasing stimuli to achieve the same level of satisfaction. This constant chasing of “more” can lead to a cycle of dissatisfaction, even amidst substantial financial success.
The Erosion of intrinsic Motivation
High-income Americans often find themselves prioritizing extrinsic goals – those focused on external rewards like money, status, and possessions – over intrinsic goals – those driven by internal satisfaction, like personal growth, relationships, and community contribution.
Extrinsic Goals & Unhappiness: Research consistently links a strong focus on extrinsic goals with higher rates of anxiety, depression, and lower overall life satisfaction.
Intrinsic Goals & Well-being: Conversely, prioritizing intrinsic goals is strongly correlated with greater happiness, resilience, and a sense of purpose.
The pressure to maintain or increase wealth can also diminish enjoyment in work. What starts as a passion can become a source of stress and obligation,eroding the intrinsic motivation that initially fueled success. This is particularly relevant in competitive fields like high-finance and entrepreneurship.Companies like Wealth Broker, while operating within regulated financial systems (as evidenced by SEC and FINRA oversight), represent the environments where this pressure can be intense.
Social media and the constant exposure to curated portrayals of wealth exacerbate the tendency for social comparison. High-income individuals are frequently enough surrounded by others with similar or greater financial resources,leading to a perpetual feeling of “keeping up with the Joneses.”
This relentless comparison fuels:
- Relative Deprivation: Feeling unhappy not because of absolute poverty, but because others have more.
- Status Anxiety: Worrying about one’s social standing and the perception of success.
- Materialism: An excessive focus on acquiring possessions as a means of achieving happiness and status.
the pursuit of status symbols rarely delivers lasting fulfillment. The satisfaction is fleeting, quickly replaced by the desire for the next status symbol.
The demands of building and maintaining wealth can often come at the expense of relationships and social connections. Long working hours, frequent travel, and a focus on career advancement can leave little time for nurturing meaningful bonds with family and friends.
Social Isolation: Wealth can sometimes create social barriers, making it difficult to form genuine connections with people who don’t share similar financial circumstances.
Relationship Strain: Financial stress and disagreements about money are major contributors to marital conflict and divorce.
Reduced Community Involvement: A lack of time and energy can limit opportunities for volunteering and participating in community activities, which are vital for fostering a sense of belonging and purpose.
Strong social connections are consistently identified as a key predictor of happiness and well-being.
The Role of Values and Purpose
Ultimately, happiness isn’t about how much money you have, but how you use it and what you value. Individuals who prioritize values like kindness, compassion, and authenticity tend to be happier than those who prioritize wealth and status.
Values Clarification: Taking the time to identify your core values is a crucial step towards living a more fulfilling life.
Purpose-Driven Living: Finding a sense of purpose – something that gives your life meaning and direction – is essential for long-term happiness.This could involve pursuing a passion, contributing to a cause you believe in, or simply making a positive impact on the lives of others.
Experiential Purchases: Research suggests that spending money on experiences (travel,concerts,learning a new skill) tends to bring more lasting happiness than spending it on material possessions.
Benefits of Shifting Focus: A Happier, More Balanced Life
Moving beyond the relentless pursuit of wealth and focusing on intrinsic values offers significant benefits:
Reduced Stress & Anxiety: Less pressure to constantly achieve and accumulate.
**Improved Mental & Physical Health
