How COVID-19 Changed Perceptions of Wealth

A half century ago, influential economist Milton Friedman declared that the purpose of a business is profits. Period. Fast forward to 2014, and the highly successful founders of Whole Foods wrote Conscious Capitalism, outlining how a business could be ethical and profitable. In 2019, 200 CEOs from around the world signed a declaration asserting that their companies and their wealth exist to “serve not only their shareholders,” but their customers, employees and the communities in which they operate. 

And then, in 2020, came COVID-19, which triggered additional changes in how the nation conducted business, some of which will be permanent.

  • The daily commute became a telecommute. That not only changed how we work, but it also forever changed business management’s view of off-site productivity.
  • That, in turn, tamped down the demand for office space, meaning “commercial real estate” will never be the same.
  • Instead of getting in a car and going to a store, we got online to buy, well, just about everything. Even a car. And that forever changed the meaning of “shopping.”

Those and many other changes in the country’s economic life occurred, not over a half century, but in a little over a year. And they, in turn, prompted both major and minor shifts in attitudes about wealth among high net worth (HNW) Americans. 

This attitudinal shift was borne out by the second installment of a comprehensive survey of HNW individuals titled, appropriately enough, The WHY of Wealth 2021, fielded in spring of 2021 by banking and wealth management firm Boston Private, an SVB company. The timing of the survey could not have been more spot-on in terms of measuring pandemic-inspired shifts among America’s wealthy. In this case, respondents with investable assets ranging from $1 million to $15+ million.

As its name implies, The WHY of Wealth 2021 survey explores just that: Why do people who become wealthy want financial success? What are their key motivators? 

For starters, the 2021 survey confirmed a finding from the first installment done in 2018 that “emotional goals” were among “the most important definition of wealth” for the survey’s HNW respondents. That is, they view wealth as much more than just a collection of assets. Instead, they primarily associate wealth with positive emotions, such as peace of mind, independence, success, happiness and security. And the pandemic magnified all of those associations. 

For one thing, HNW individuals had more time to do things that gave them peace of mind. Isolated from “the rat race,” they were not spending time in airports, or commuting or cabbing around town. Instead, they were spending time in a second home their wealth provided, well away from the city, often in a country setting. They could feel even more independent, not to mention secure, and even happier than usual. 

As we can see, the 2018 installment of the survey provides a useful benchmark for comparing HNW attitudes and behaviors, pre- and post-pandemic. And while, in general, wealthy Americans fared better during the COVID-19 pandemic than those less fortunate, they were certainly not totally spared its ill effects. As Kathleen Kenealy, CFP®, CPWA® Director of Financial Planning at Boston Private, an SVB company, puts it:

“Having wealth didn’t insulate anyone from the initial effects of the pandemic, whether it was seeing your portfolio decline by 20 or 40 percent last spring or having your health, and the health of those around you, impacted.” 

But while HNW individuals may be universally threatened by COVID-19, the survey reveals more than a few generational contrasts. For example, while the COVID-19 pandemic prompted approximately 60 percent of all respondents to reevaluate their perception of wealth, some 78 percent of millennials and 73 percent of Gen X said the pandemic will change how they use their wealth in the future. But only 26 percent of Baby Boomers and the Silent Generation said that it will.

A 50-point percentage difference is highly unusual in any survey, so what explains this generation gap on reevaluating wealth perception? Perhaps the most obvious explanation: 

Older respondents built their wealth when millennials were in diapers and Gen Xers were in grade school. They’ve been enjoying their wealth, as they saw fit, for decades. In contrast, younger HNW individuals are in some stage of building their wealth; by necessity, they have to be flexible and shift goals for and perceptions of their wealth as they go. 

Of course, as often happens, in the case of the pandemic, adversity also helped produce positives. Despite some brief declines, it seemed the stock market hardly noticed there was a pandemic. A survey of articles regarding how the HNW will fare post-pandemic shows a near unanimity that “the 1 percent” will enjoy a prosperous 2021. Perhaps that is because operating during a disaster can sometimes breed new and positive habits.

As Kenealy says: “The pandemic forced family-owned and personally owned businesses to be nimbler and more responsive.”

Not to mention, more reliant on outside help. The pandemic prompted HNW individuals to reevaluate the role and importance of their financial advisors. As has been said, anyone can plan for prosperity. But when your prosperity seems in peril, like a 20 or 40 percent hit to your portfolio, suddenly you realize you can’t do this alone. Which accounts, at least in part, for HNW respondents to the Boston Private survey upping their use of a financial advisor: pre-pandemic, 63 percent engaged an advisor; post-pandemic, 77 percent had hired one.

Kenealy points to another example of a pandemic positive for survey respondents. “The necessity of employees working from home,” she says, “accelerated technological adoption to maintain productivity.” But it also prompted a reevaluation of office space itself. 

In another survey, this one done by Fortune magazine, 51 percent of respondents said that in the future, they will need “a little less office space than we had in 2019,” while 22 percent said they will need “a lot less.” The majority—53 percent—believe a hybrid approach, with two or three days in the office and two or three days at home, is optimal.  

So, there is yet another wealth perception change, something as simple but significant as where you and your team will create it.

One final pandemic-inspired change in wealth perception among HNW individuals regards their approach to philanthropy. They plan to be more generous in the future. Over half of survey respondents (52 percent) say the pandemic has improved their donations and philanthropic commitment. It could also explain why 16 percent of HNW respondents accelerated their donations to charities versus what they donated before the pandemic. 

Like all Americans, the wealthy are anxious to put the pandemic behind them as much as possible. Despite its horrific toll on the world, the pandemic clearly changed perceptions of wealth among high net worth Americans. It is a change that has produced a more efficient, more insightful, more productive and, perhaps best of all, a more generous HNW population.  


This article was developed and paid for by Boston Private, an SVB company.

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SVB Wealth Advisory, Inc. (member FINRA and SIPC; SEC-registered investment adviser) offers brokerage and investment management products and services and is a wholly-owned, non-bank subsidiary of Silicon Valley Bank. Boston Private Wealth LLC (“BPW”) (an SEC-registered investment adviser) offers wealth management services and is also a wholly-owned, non-bank subsidiary of Silicon Valley Bank. Investment Products offered by SVB Wealth Advisory and/or Boston Private Wealth are: Not FDIC Insured, Not Bank Guaranteed, and May Lose Value.

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