Americans Have Loss Financial Hope
|January 20, 2010||Posted by Roshawn Watson under Uncategorized|
A recent study highlights how Americans have loss hope for getting rich.
The study was performed for Bankrate.com by Princeton Survey Research Associates International, and their results show that a whopping 70% of respondents think it is more difficult to get rich in America than it use to be. The same question was asked in 1999 and showed 38% of respondents thought that it is more difficult to become rich then.
Of course the obvious offenders are likely the blame for this dramatic shift: decimated real estate values and stock portfolios, high unemployment, and interminable negative media coverage on the economy. There have been some economic hurdles to overcome. If you have indeed sufferred from an income loss, then yes you had to suspend your wealth-building to focus on your income crisis. Additionally, 2008 was a very rough year for most: Americans collectively loss about 23% of net worth, as the market erased 3 years of economic growth. I still question the veracity of it being more difficult. Consider the great stock rally of 2009: S&P; soared an impressive 63%. If you invested wisely last year, you would have experienced some real growth. Additionally, even though the recession was very deep, some would argue that at least some of the loss wealth was paper-wealth only. For example, real estate prices were greatly inflated in many areas, so a correction wasn’t wholy-unexpected.
Perhaps what’s even more interesting is their results from the question: “what is the most likely way for someone in America to get rich? 20% of respondents said the best way to get rich is to start a business, and another 19% said that the best way is to choose a high-paying career. A surprising 15% said the best way was luck (inheritance & lottery), 15% said the best way is savings and frugality, and 12% said investing in stocks & bonds. 8% said investing in real estate.
Come on, for real?
People are certainly entitled to their opinions, and that’s exactly what this survey reflects: the opinions of the masses about how to get rich. Unfortunately, most of us are not rich, and instead of learning from those who are, 15% of us would rather purchase a lottery ticket or wait for someone rich to kick the bucket (Sorry, I’ll stop with the pessimism henceforth). This certainly doesn’t reflect the opinions of the rich. According to the 400 richest Americans (Forbes 400), 75% believe “the best way to build wealth is to become and stay debt-free.”
In fact, this is why there are great wealth transfers during difficult financial times: if you are operating in hope while everyone else is operating in fear, you will find deals for very cheap. For example, this is the premise for how Tepper and Paulson generated billions dollars last year.
Copyright 2012, Roshawn Watson, Pharm.D., Ph.D. All Rights Reserved.