We live in a country that once celebrated
itself as egalitarian, yet 1 percent of the population
-- nearly 3 million people -- currently has as
much money as the 100 million people at the bottom
of the ramp.
Yet when I ask those at the top of the ramp how they feel about the future, whether their fortunate place on the ramp gives them a measure of confidence about it, they shake their heads. They give me a look that says, "What planet do you park on?"
You and your
If you're not parked near the top of the ramp, you're of little or no interest to financial services firms and financial advisers. There's no money to be made at these levels. Last year, a handful of Wall Street firms told their brokers they would no longer receive commissions on accounts holding less than $50,000. This effectively tells people with nano-Numbers to get lost. But for the Wall Street firms, there's gold on the floors above. The greater the household assets, the more fees and transaction costs can be extracted from an account. The result is a flood of advertising that captures a lifestyle so gloriously affluent it's enough to make everybody feel poor.
Those who manage Numbers break customers
down into innumerable segments to better target
them through their marketing efforts. These segments
take into consideration all the usual demographic
characteristics, such as age, income and net worth.
Other segmentation models define you according
to psychographic qualities: personal interests,
leisure-time activities, whether you are active
or passive when it comes to managing your affairs
-- including, for instance, how comfortable you
are using a computer. Once a financial services
company figures it has your Number, it will use
what it thinks are the most effective channels
to get its hands on it. It will place advertising
in the magazines and newspapers you read and the
television shows and Web sites you browse. And
it will probe you incessantly through the mailbox,
testing or selling financial products and services.
The Number industry divides people on the top floors of the garage into three broad segments of wealth, each of which is nicely profitable.
The biggest and broadest affluent
segment consists of people with investable assets
of between $200,000 and $1 million to $2 million.
This group is sometimes referred to as mass affluent,
and it would be fair to think of it as the meat
and potatoes of the financial services business.
If you're at the lower end of that range -- if
you have, say, $300,000 in your accounts -- you're
definitely of prime interest to the brokers and
customer reps at Merrill Lynch, Smith Barney,
Vanguard and the rest. But they need to be careful
lest you cost them money.