Over the last few decades, there has been a rapid rise of affluence in America. According to 2003 Census figures, one in every four households in the country is now "mass affluent," -- defined as people living in households with annual incomes of $75,000 and above -- compared with only about one in seven in 1980. This article is the second in a series examining this demographic segment that wields serious purchasing power and presents savvy marketers with new opportunities.
Do the moneyed have different life priorities? According to a three-year aggregate of data from Gallup's annual Lifestyle survey*, "mass affluents" (people in households earning $75,000 or more annually) in the United States not only earn more than their non-affluent counterparts, but they also tend to approach a few aspects of their lives differently.
Mass affluents tend to place more importance on friendships, their leisure time, and their money than they do upon religion. As a group, affluents are also quite charitably inclined -- giving both time and money to religious organizations and other charitable causes. However, it may surprise some to learn that affluents' greater material wealth doesn't seem to boost their overall feelings of contentment. Beyond a certain income threshold (around $30,000 annually), non-affluents are no less likely than affluent Americans to say they are happy.
Friends Matter More Than Religion
Americans of all income groups agree their families and their health are what matter most in their lives. However, while non-affluents attach roughly equal importance to friendships, money, and religion, affluents are somewhat more likely to put friendship, leisure, and money ahead of religion. Seventy-nine percent of affluent Americans say friends are either "extremely" or "very" important in their lives, 67% say the same about their leisure time, and 65% say the same about money. Only 57% of mass affluents assign this level of importance to religion. In contrast, religion is extremely or very important to 67% of non-affluents.
When it comes to the number of close friendships they have and their satisfaction with these friendships, affluents and non-affluents are quite similar. On average, members of both groups have about nine close friends, and 76% of each group are satisfied with the number of friends they have. Although affluents attach slightly more importance to their friends than non-affluents do, there is a little more discontentment among affluents with regard to the quality of their friendships. Some 22% of affluents express a desire for closer relationships with their friends, compared with 15% of non-affluents who say the same.
Revealed Preference: Non-Religious Volunteering
That affluents are somewhat less likely than their non-affluent counterparts to attach a high degree of importance to religion is reflected in how affluents choose to volunteer their time and donate their money. While more affluents than non-affluents say they had donated money to religious organizations and other charitable causes in the last year (no surprise, because affluents likely have more money to donate), affluents were more likely to say they donated money and volunteered time to charitable causes than to religious organizations. Fifty-five percent of affluents vs. 40% of non-affluents say they volunteered their time in the last year to a charity other than a religious organization.
Not Quite Resisting the Hedonic Treadmill
It is well documented that in the developed world, rising incomes have not resulted in proportionate increases in self-reported happiness and this finding seems to hold true in the case of the mass affluents as well. Mass affluents as a group do report higher happiness levels (59% call themselves "very happy") than non-affluents (49% are very happy). However, this is because those living in the lowest income households (earning less than $30,000) bring down the average happiness level for non-affluents. Apart from this significant gap, Gallup does not find a linear increase in happiness as we look up the ladder of household income.
*Results are based on telephone interviews with 2,012 national adults, aged 18 and older, conducted December 2001, December 2002, and December 2003. For results based on the total sample of national adults, one can say with 95% confidence that the margin of sampling error is ±2 percentage points.