Fidelity Investments announced this morning that its millionaire clients -- those with $1 million, excluding real estate and retirement accounts -- are feeling more optimistic about the economy. Does that mean the rest of us should be encouraged?
Sanjiv Mirchandani, president of National Financial, a division of Fidelity, says yes: "In many ways, the average investor can learn from what millionaires are thinking or doing. For instance, millionaires tend not to panic and become gripped by inertia, while they are careful about spending and have well-developed financial plans."
Here are some of the ways rich people think about money and retirement planning these days:
- These investors took the 2008 meltdown in stride. Only 17 percent said the 2008-2009 downturn shook their investing confidence.
- They learned from the meltdown. Forty-three percent of millionaires say they are more knowledgeable investors now than they were before the market downturn.
- Rich people are cautious. Despite having a healthy bottom line, 25 percent of these investors are concerned that they won't have enough money to support their lifestyle in retirement.
- They think taxes are a threat and they're doing something about it. Some 64 percent are either "extremely or very concerned" about the impact of potential tax changes on their investments and are seeking ways to protect their wealth from Uncle Sam's reach.
- Frugality counts. More than 80 percent say they are "careful" about their spending.
- Wealth is relative. About 42 percent of millionaires say they would have to have at least $7 million to feel wealthy.
- Optimism rules. More than 68 percent don't expect market volatility to become the new norm.