Growing Numbers of Wealthy Americans Eschew Traditional Labels, As Segment of Affluent Consumers Embrace Middle Class Values

Business Wire,  Feb 8, 2005

SAN FRANCISCO -- Visa Signature Study Finds "New Affluents" Recalibrating Notions of Wealth

A new study released today by Visa shows how dramatically today's young, new affluent consumers reject traditional views of wealth, aligning their perceptions and values more with their parents' middle-class approach to living - trading prestige and luxury for value, pragmatism and the adventure of doing more with what they have.

The study was fielded as part of Visa's efforts to increase the effectiveness of programs developed by Visa Member financial institutions and merchants, helping them better identify relevant types of rewards programs and benefits for affluent customers.

According to the poll, conducted by Visa Signature, "New Affluent" consumers - a mere 7 percent of the American population, primarily comprised of individuals aged 35-54 whose household income is at least $125,000 - clip coupons more than other Americans, report embarrassment in being identified with wealth and status, and are more concerned about passing along honesty and integrity to their children than money or status.

They may not be the "Millionaires Next Door" just yet, but this deeper look at New Affluent Americans reinforces how radically different today's upscale households are from the old paradigm of wealth.

 

"As the New Affluent bring their largely middle-class values and identity to bear in the way they believe, live and shop, the rules for marketing to upper income consumers are being rewritten," says Michael J. Weiss, demographic expert and author of "The Clustered World: How We Live, What We Buy and What It All Means to Who We Are". "Their tastes are a lot more mid-scale than their wallets."

Weiss notes that as high-achievement individuals, New Affluent consumers tend to have worked extremely hard for their wealth and overall success. With the knowledge of how hard it is to "make it," he says, they are ultra-vigilant about spending wisely.

The study spotlights attitudes and behaviors of New Affluent individuals as an increasingly critical segment of American consumers, representing 15 percent of total U.S. spending and growing in numbers and spending strength. In key areas, the poll compared and contrasted opinions of New Affluent consumers with other Americans.

Eschewing Traditional Labels of Wealth

The study shows how "unaffluently" these consumers think of themselves, despite their considerable financial means. With household incomes that are at least triple the national median, New Affluents identify primarily with the middle class.

--Nine out of 10 New Affluent consumers surveyed identify themselves as "middle class" or "upper middle class," while only 7 percent - most with incomes in excess of $500,000 - describe themselves as "affluent."

--Nearly three-quarters (72 percent) of New Affluent consumers surveyed say they are embarrassed by or dislike being identified by terms such as "wealthy" or "well off," while acknowledging these terms accurately describe their situation.

--Less than one-third (27 percent) of New Affluent surveyed consumers say the term "status" has any meaning to their lives.

--"Honesty and integrity" top the list of important things New Affluent consumers surveyed would like to pass along to the next generation, while "social status" and "money" were ranked at the bottom.

The Hunt for Value: Clipping Coupons and Foraging Garage Sales

Showing a decidedly practical orientation, the study shows that New Affluents are exceptionally thrifty at the core; viewing the quest for great values that enhance their life as a game they enjoy winning.

--Almost three-quarters (72 percent) of New Affluent consumers surveyed report that they clip coupons - significantly higher than the national average of 65 percent.

--More than a third (34 percent) of upscale consumers surveyed report they have hunted for bargains at garage sales in the past year, and about the same number say they shopped for deals at going-out-of-business sales.

--Two-thirds of New Affluent consumers surveyed say they regularly shop at club discount or warehouse stores. This compares to less than half of the general population sample doing the same.

Value as an Adventure

According to the Visa Signature poll, the search for value extends from payment cards to travel accommodations and discretionary money, as these consumers look for ways to maximize their resources and keep the "deals" tipped in their favor.

--Almost four-in-five (78 percent) of New Affluents surveyed say they have a payment card that enables them to earn rewards and enjoy perks. This is significantly higher than the general population (38 percent). Sixty-five percent of New Affluent consumers surveyed say they like to do everything they can to maximize rewards on their payment cards.  --When traveling for pleasure, well over half (57 percent) of New Affluent consumers surveyed say they choose mid-range hotels that provide the basics for a good price, while only 13 percent say they choose high-end hotels.