Category: Money

Here are the personality traits of the self-made millionaire

By Matthew Warren

“Let me tell you about the very rich,” wrote F. Scott Fitzgerald in The Rich Boy. “They are different from you and me.”

Fitzgerald’s narrator was referring to the way wealth can shape people’s character — but a new study suggests that people with particular personalities may also be more likely to become wealthy in the first place.

Writing in Humanities and Social Sciences Communications, the team finds that millionaires have a unique pattern of personality traits compared to the rest of us — and this is particularly true for millionaires who made their wealth on their own.

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Reality TV fuels people’s belief in the American Dream

By Matthew Warren

The “American Dream” is deeply rooted in the national identity of the United States. It promises that in the Land of Opportunity, any individual can climb the economic ladder and prosper through hard work and ambition alone. And yet, young Americans today are struggling to earn more than their parents did at the same age, and upward mobility in the US actually compares unfavourably to that of other industrialised nations.

So why does the idea of the American Dream persist? A new study in the American Journal of Political Science identifies one factor that has been overlooked: the influence of reality TV.

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Having a sense of meaning is less important for your happiness if you’re rich

By Emily Reynolds

Searching for meaning is something many of us experience throughout our lives: finding something to strive for that gives shape, direction, and purpose to the things we choose to do. For some, this meaning is religious; some political; some interpersonal. And having a sense of meaning can bring us happiness (or, if we lack meaning, unhappiness).

A new study to be published in Emotion looks at the relationship between meaning and happiness in the context of financial resources. Rhia Catapano from the University of Toronto and colleagues find that meaning is a far weaker predictor of happiness for rich people than poorer people — suggesting economic resources can impact how we experience meaning.

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Magical thinking and insurance: Taking out cover makes us feel that misfortune is less likely to occur

By Matthew Warren

We’re all prone to a bit of magical thinking now and then. Maybe you try not to step on cracks in case it brings bad luck, or avoid talking about a good situation in case you “jinx” it — even though in reality there’s no way your actions would have any effect on the world.

When it comes to decisions about finances and risk, though, you’d probably claim to be a much more rational thinker. However, a new study in Personality and Social Psychology Bulletin finds that we’re even susceptible to magical thinking when taking out insurance. The team finds that insuring against the loss or damage of a valued possession has what they call a “talisman effect”, making us feel that the misfortune is actually less likely to occur in the first place.

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People Think That Individual Billionaires Are More Deserving Than “The Rich” As A Group

By Emily Reynolds

Oprah Winfrey, Steve Jobs, Bill Gates… if you’re looking for motivation or personal inspiration, it’s likely that you’ll see quotes from rich, prominent people. At the same time, there seems to be growing discontent with the levels of inequality in the world — a discontent seemingly at odds with the worship of wealthy people we see in the media and online.

A new study, published in PNAS, explores this disconnect. It finds that even as we see the wealth of billionaires as a group as unfair, we remain tolerant of the achievements and wealth of individuals. And this also has an impact on the policies and positions people are willing to support.

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People Will Pay Money To Avoid Having To Exert Self-Control

By Emily Reynolds

Self-control — or lack of it — can have a serious impact on our lives. Poor self-control can lead to feelings of loneliness, while those with higher levels of self-discipline experience states like hunger and tiredness less intensely. Yet despite these obvious benefits, the vast majority of us sometimes experience failures in self-control no matter how hard we try.

A new study, published in PNAS, looks to quantify the cost of self-control. Candace M. Raio and Paul W. Glimcher from the New York University School of Medicine find that we’re willing to pay a monetary price to avoid having to exert self-control — and we’ll pay more if the temptation is particularly strong.

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The “Maybe Favour”: We More Readily Commit To Helping A Stranger If We Might Not Have To Follow Through

By Emma Young

Imagine that a neighbour asks for a favour — to help move some garden furniture at the weekend, say. Now imagine that, instead, they explain that they’d lined up a friend to help, but that friend has become ill, and you’ll only be required if they’re not better in time.

Rather than a firm favour, this second scenario involves what the authors of a new paper in the Journal of Experimental Psychology: Applied dub a “maybe favour”. And, Michael K. Zurn at the University of Cologne and colleagues report, we are more likely to agree to grant these favours than ones that we know for sure we’ll have to come good on. This might not be surprising in itself — but the team goes on to show that exploiting the “maybe favour” effect could have big implications for society.

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We’re More Likely To Steal From Large Groups Than From Individuals

By Emma L. Barratt

We’re all aware of the financial disparity that plagues our economic systems. Many of those at the top of large corporations seem content to exploit large groups of people for their own significant financial gain.

Strangely, this is somewhat at odds with previous research in behavioural economics, which tends to find that people are generally quite prosocial, honest, and overall unwilling to steal considerable amounts from others. From results like these, it’s difficult to piece together exactly how we’ve arrived at such levels of financial inequality.

Psychologists have floated a number of potential explanations for this phenomenon. Perhaps those who end up rich have innately higher levels of psychopathy, for example. Or perhaps it’s the case that the cultural norms within certain businesses change the way people make economic decisions. However, new research in Nature Human Behaviour from Carlos Alós-Ferrer and colleagues suggests an alternative explanation: when it comes to acting selfishly, we are much more likely to do it at a grand scale than a small one.

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Diversity Grants Can Discourage Diverse Candidates From Applying For More Lucrative Scholarships

By Emma L. Barratt

It’s no secret that marginalised groups face barriers in educational settings that the able-bodied, male, and racially privileged largely do not. Issues pertaining to access, sense of belonging, potential discrimination, and financial difficulties can add often insurmountable layers of complexity to applying for further education.

Efforts to address this in recent years have crystallised into a number of measures, including the wide adoption of diversity and inclusion grants. These provide financial support specifically for selected individuals from marginalised groups, in order to give them a more equal footing with applicants from privileged backgrounds.

However, recent research from Adriana L. Germano and colleagues at The University of Washington has illustrated some unintended flaws with this approach. In stark contrast with the ethos behind diversity and inclusion initiatives, these grants may be serving to make applications to prestigious scholarships even less diverse than before.

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Tackling Income Inequality Could Boost Children’s Vocabulary

By Emily Reynolds

In 1995, a seminal book was published suggesting that children from lower socioeconomic backgrounds were exposed to 30 million fewer words than richer children by the age of 4 — the so-called “word gap”. The idea is now widespread and has informed early childhood policy in the United States (though the findings are more contentious than this ubiquity might suggest).

But why might these kids be exposed to fewer words? A new study from a team at the University of California, Berkeley, finds that worries about financial insecurity reduced the amount that caregivers spoke to their small children, suggesting that these concerns themselves could be at least partly responsible for the word gap.

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