While it's certainly nice to be rich, these are not the easiest times to be a member of society's top tier of income earners. Venture capitalist Tom Perkins laid it down last year when he wrote to The Wall Street Journal: "I perceive a rising tide of hatred of the successful 1 percent."
If the public's scorn has caused the wealthy to shift their consumption patterns, there's evidence for it in a new survey released by YouGov and Time Inc. It shows (with a few exceptions) that the rich are cutting back on their discretionary buying of flashy, conspicuous items like expensive jewelry and fine watches in favor of "experiential" purchases like travel—which is still a lot of fun, but less visible. Since the great financial meltdown of 2008, "there's been a tendency for people to believe that money should be kept under the radar," said YouGov managing partner Cara David.
Of course, another—and possibly bigger—reason for the shift to experiential spending is that the definition of quality of life is simply evolving. "One of the things we've seen over the last couple of years is a change in mindset toward living a fulfilled life," observed Caryn Klein, vp of research and insights at Time Inc. "The top 10 percent have reprioritized what's important in their lives," David added, "putting their discretionary income toward experiences and things that create memories."
This explains, for example, the survey's finding that expenditure for dining out rose, while the purchasing of items for the home declined. And while spending on big-ticket items like automobiles is projected to rise by over 7 percent, the survey found that only 22 percent of that group planned on spending more than $70,000 for it—meaning, even when it comes to indulgent purchases, discretion is increasingly the order of the day.
Jason Cohen, evp, creative for luxury branding agency The O Group, has been watching these trends develop for several years, and says that the rich are making important distinctions between purely material indulgences and ones that have a more lasting meaning. "Any affluent individual can afford expensive goods, but they're physical objects that can be replaced when the new model arrives," he said. By contrast, "experiences become a part of us. They also provide more engaging content for discussion. It's generally more engaging to talk about something you've done versus something you own."