Inherit or Earn: Which Would Make You Feel More Secure
Earners Feel More Secure Due To Their Confidence To Control and Preserve It.
PNC Wealth Management conducted the survey of people with more than $500,000 of investable assets. The Wealth and Values Survey showed that 69% of “wealthy” Americans accumulated most of their money through work, business ownership or investments; 6% percent received money through inheritance; and 25% gained wealth through a combination of inheritance and earnings.
A couple of things separate the earners from the inheritors: First, earners were in control of making their money, and therefore feel more confident about preserving it or making even more. Second, earners likely took large risks to achieve wealth. As we all know, as risk increases, so does return. Accordingly, earners are likely more comfortable with the concept of risk.
Driving the point of risk tolerance home, the report says earners also have a higher risk tolerance than heirs: 39% of earners rate themselves as moderate to risky investors compared with 21% of heirs. Those who inherited their wealth often view themselves as stewards for future generations. As a result, they tend to be more conservative in their approach to investing.
Other Intersting Finds:
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Heirs are more than twice as likely to say “Having a lot of money brings about more problems than it solves.”
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More people who have earned their wealth (37%) agree with the statement: “The money I have made so far has come from being in the right place at the right time.“
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Far more of earners agree with the statement: “Every generation should be responsible for creating its own wealth” along with “It is more important for children to learn the value of money through hard work.”
Not a bad idea, adults!
