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You don’t have to be in the workforce very long before you’ve probably noticed something very interesting: the most successful people are not always the smartest or most talented or even most ambitious. All those attributes certainly help, but the most successful people often seem to simply get along with other people remarkably well.

The attribute that many people don’t recognize and that helps people interact well with others is emotional intelligence. We’ve discussed that subject before in relation to raising children (Making Your Kids More Emotionally Intelligent), but there’s a related subject that involves adults — in particular adults who seem to have an inexplicable ability to accumulate wealth. Like successful people who may not be the smartest or most talented person in the room, unusually wealthy people may also not be standouts in an obvious way.

Writing for New Trader U, Steve Burns focuses on an attribute that may be more important than financial skills or market savvy. It’s a psychological trait called wealth psychology. “This fascinating field explores the intricate relationship between our minds and money,” he says, “shedding light on why some people always get richer while others struggle to build wealth.”

Start With The Basics

If they can objectively evaluate their own actions, anyone who has traded in the stock market for any length of time realizes that decisions are rarely made completely on the basis of rational analysis. Burns summarizes this by saying, “Wealth psychology is a specialized discipline that examines how our thoughts, emotions, and behaviors influence our relationship with money and success. At its core, this field recognizes that our financial decisions are not made in a vacuum but are profoundly influenced by our mental frameworks and emotional responses.”

The key to understanding wealth psychology is recognizing the importance of a money mindset. “This refers to the beliefs and attitudes we hold about money, ranging from scarcity-driven fear to abundance-oriented optimism,” says Burns. Acting out of fear or optimism are both emotion-driven actions and each can lead to a drastically different result. The problem is that we often act without realizing that we are coming from a position of fear or optimism. These sub-conscious drives or inhibitions can actually be psychological barriers to gaining wealth — and overcoming these obstacles usually requires conscious effort.

Burns goes on to examine a range of factors that affect the ability to gain wealth, including:

The Power of Mindset In Wealth Accumulation. Psychologist Carol Dweck draws a distinction between a fixed mindset and a growth mindset. A person with a fixed mindset is limited, believing that abilities are given and unchanging. A person with a growth mindset essentially believes the opposite, that development is possible.

Emotional Intelligence and Financial Decision-Making. People who are more aware of how their emotions affect their actions have a better chance of managing their emotions and controlling outcomes.

Aligning Wealth With Personal Values And Goals. Gaining wealth for its own sake is hardly a path to happiness. Accumulating wealth and then using it to further a higher goal can be a path to a meaningful life.

Developing Financial Discipline Through Psychology. Sacrificing immediate gratification for longer-term success is almost always required to achieve a long-term goal.

Balancing Wealth Pursuit And Mental Well-Being. While avoiding immediate gratification is a good rule of thumb, it’s also imperative to enjoy life day to day. The key is to live a balanced life.

The Dark Side Of Wealth Psychology: Pitfalls To Avoid. What is a good definition of wealthy? Having liquid assets of one million dollars? Ten million? A hundred million? It’s crucial to be able to recognize when you have enough, and research shows that happiness does not increase after a certain point.

Wealth psychology is complex and nuanced. See Burns full article here for a deep dive into the psychology of wealth, including links to articles that explore the many concepts underlying the psychology.

Disclaimer: The content provided on this website is intended for general informational and educational purposes only. It does not constitute legal, financial, or tax advice. We strongly recommend consulting with a qualified professional for advice tailored to your specific circumstances.