The pandemic changed everything about how affluent millennials view wealth

Wealthy millennial
Wealthy millennials view wealth differently thanks to the pandemic. Sarah Stier/Getty Images

Wealth no longer means what it used to for high-net-worth millennials.

The pandemic has caused the wealthy to alter their lifestyles and reassess their priorities, changing how they perceive wealth in the process, a report by Boston Private found. The report, titled the Why of Wealth, surveyed high-net-worth individuals with at least $US1 ($AU1) million of assets.

Millennials, who turn ages 25 to 40 this year, changed their perceptions of wealth the most. More than three-quarters (89%) said the pandemic altered the way they define wealth. The generation was also most likely to say the pandemic shifted their wealth priorities and their emotions about wealth, with 85% of respondents feeling this way about each change.

Both Gen X and Gen Z felt fairly similarly, with at least three-quarters of each cohort identifying in the same way for nearly all these sentiments. However, it’s a sharp contrast from baby boomers and the silent generation. Less than a quarter (24%) of both generations combined said the pandemic changed their perception of wealth. The report attributes this to their age, as they’ve already experienced significant cultural milestones and being more settled into a certain mindset.

More millennials (as well as Gen X) associate wealth with success and happiness, whereas boomers and the silent generation are more likely to view wealth as peace of mind and independence. “For these younger generations, wealth is a key contributor to creating a comfortable, happy life, and is directly related to achieving important goals, having a good family life and being a positive contributor to community and society,” the report reads.

Older generations feel less able to use their wealth on enjoying life as much as they’d like to right now, according to the report, whereas younger generations are possibly using their wealth to enjoy life more than they feel they should.

What’s more is that this shift in perception of wealth has also affected millennials’ wealth goals – 78% said the pandemic changed how they planned to use their wealth in the future, compared to 26% of baby boomers and the silent generation.

Saving has been up across the board during the pandemic, as the US household net worth hit a record high in the fourth quarter, up 5.6% from the third quarter. Many wealthy Americans were able to tuck away excess cash, with wealthy millennials tucking away as much as $US3,000 ($AU4,114) a month. Some have increased their retirement savings or readjusted their financial plans plans as a result.

But whether this shift in wealth perception and goals is temporary or permanent remains to be seen.