Wealth: What’s in a word.
By David Penney
Language is a magnificent and wonderous thing.
It allows us to describe and make sense of our confusing universe, bringing order and structure to our lives through a common and shared understanding.
It is the most powerful tool that we all possess, enabling us through the careful choice of our words to inform, influence, persuade, coerce, deceive, manipulate, comfort, celebrate – the list goes on.
Every language has its rules, quirks and even eccentricities but it is the English language that stands apart as probably the world’s most nuanced with its million or so relatively commonly used words, many of which broadly mean the same thing.
I say only broadly the same thing as we know that there are many words that seek to identify the same thing but can convey a very different meaning.
For example, somebody who works for the local council may be described as a bureaucrat or as a public servant, both are technically correct but suggest something fundamentally different.
Or when we look at the conversation around the movement of people around the world, we will often see the use of the word migrant or immigrant when speaking of people from other countries but use the softer term ‘expat’ when describing migrants from our own country even when they are identifying the same thing.
We have a language that allows us to use a variety of different words to identify the same thing but to convey a very different message – often the choice of word will be subconscious but for the listener, the nuance will be clear.
And that is the fundamental thing about how we use language and words – it is often not the technical meaning of the word itself but what that word implies to those hearing or reading it that actually matters.
It is an issue that has come into focus this week after St. James’s Place unveiled its plans to refresh its brand identity to coincide with its 30th anniversary this year.
The project will see an evolution of its visual brand, but it will also see St. James’s Place drop the ‘Wealth Management’ descriptor from its company name, a move the company believe is more in line with the structure of the business – its partners are the wealth managers while St. James’s Place is the engine that sits behind them in support.
Claire Blackwell, the excellent marketing director at St. James’s Place who has been leading this project, also described wealth management as “quite a loaded term”, potentially putting people off from getting advice because they don’t consider themselves wealthy.
It is an arguably brave position to take but also makes a huge amount of sense – and is a clear example of a word that will mean different things to different people and that the meaning of the word will change as the world changes around us.
When we look at the dictionary definition of the word, wealth is described as ‘an abundance of valuable possessions or money’ but the truth is that your abundance may be very different to my abundance.
According to a survey by a major US financial institution, respondents in 2020 believed that $2.6m of assets was needed to be wealthy while this fell to $1.9m in assets when surveyed again in 2021.
It is hard to argue that somebody with this level of assets was not wealthy and yet according to Ameriprise, just 13% of American millionaires consider themselves to be wealthy – ultimately then when it comes to what wealth means, it is very much a question of personal perspective.
According to the latest available figures, around one in 10 adults in the UK had regulated financial advice related to investments, saving into pensions or retirement planning over the last 12 months.
There will be numerous and varied reasons why people do not seek out advice about their finances but what is clear is that with 90% of population not currently taking advice, there are many millions who are missing a clear opportunity to improve their financial wellbeing and from a business perspective, there is a huge market opportunity.
From St. James’s Place’s perspective, this is clearly well understood and believe that one way to access new market opportunities is to remove the ambiguity associated around the idea of wealth.
The reality is that in the UK there are a vast number of people earning middle incomes who will live in a nice family home with little or no mortgage, have ISAs for the kids and 25-years of solid occupational pension payments behind them who would certainly not consider themselves wealthy and yet would significantly benefit from engaging with a wealth manager.
Of course the fact that St. James’s Place has decided it will drop wealth management from its business name is unlikely to immediately open the floodgates to a raft of new clients who were previously put off by the phrase – and it should be noted that there will be no obligation for its Partner Practices to drop the phrase from their names.
However, the decision is a great opportunity to elevate the conversation about the word wealth and what it actually means to people, particularly in the case of wealth management.
It was the famed Swedish scientist Alfred Nobel who said that “Contentment is the only real wealth” and this for me gets to heart of what the term wealth management really means.
As wealth managers, our job is to look at all aspects of a client’s financial situation and help create a plan that is as much about life as it is the accumulation of money – as important as this may be.
Worrying about money is the number one issue that keeps us awake at night and it is unarguable that society generally would be better off if more people were able to access the kind of advice that could literally change their lives – and help provide that contentment that we all seek.
If we are to encourage more people to seek advice then we have to redefine what we mean by wealth and in turn change people’s perception of what the word means to them.
Wealth, as defined by Albert Nobel, is something that is available to every one of us and we need to spread this message in the clearest language possible.