The Weird Psychology of Personal Affluence

An item in Fast Company today explains some of the strange psychology around family income. Admissions officers have long known that parents with substantial incomes often categorize themselves as solidly middle class. Citing Pew data:

There is little consensus on what middle class really means, but everyone certainly wants to be middle class: Nearly 70% of Americans consider themselves middle class, but only about 52% would qualify based on income.

We keep seeing a seeming disconnect between the objective reality of a family’s circumstances–multiple homes, luxury cars, frequent travel–and the emotional reality of how they view their lives. Despite obvious signs of affluence, people just don’t feel very well-off, and this profoundly affects their decision-making calculus when it comes to private school enrollment.

Compounding this is the “lifestyle creep” effect:

The things you might have considered luxuries as a middle class American may feel necessary once you’ve ascended to the upper middle class.

As “necessities” expand, each begins competing with the others and some may lose out in relative terms. As the Millennial generation of parents begin making there way into elementary schools:

Another key component? The $1.5 trillion in student loan debt that hangs over 44 million Americans.

Taken together, all of this means the enrollment conversation is more fraught than ever.

Business and leadership, Governance, Headship, Strategy  |  permalink

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