The Unfortunate Impact of Feeling Poor

Let's consider a scenario: you are a multimillionaire living in a neighbourhood of billionaires or you are an average worker in a community where most people are living off the minimum wage? Which one would you choose? In actuality, the average worker will be a lot happier since they are more prosperous than the people that they know. Economists believe that your assets do not matter if you feel poor. The question is, what are the impacts of feeling poor?

A 2015 survey revealed that only around 9% of millionaires consider themselves as “rich” while the rest placed themselves in the middle-class category. Shockingly, though these millionaires are wealthier than 99% of average people, they feel poor when compared to their wealthier peers. Thus, the common issue that they shared is comparing themselves to other people even when they also have millions in the bank.

Besides that, if you often compare your present to your past in terms of financials, you will also feel poor as well. Of course, this will only be the case if you were making more money in the past. For instance, if your salary used to be in the millions and now you are earning six-figures – you will be inclined to feel poor. The reality is six-figure is not a trivial sum for an average person.

A 2011 study by Princeton University concludes that individuals that feel poor exhibit less job and life satisfaction in general. Moreover, they are more likely to be unhappy and are interested in changing their careers. Also, feeling poor can hurt our self-esteem to the point that it can change one's behaviourism.

Thinking of yourself as poor can also lead to damaging financial behaviour. Additionally, several studies revealed that feeling poor may contribute to making unwise decisions involving money. Ironically, this behaviour can make you lose more of your available cash without a sound financial judgement.

Wealth is not just about money. Therefore, to make yourself feel richer, do not compare yourself to others. Remember that the grass is always greener on the other side, thus be grateful for what you own.