Why do rich people hate admitting they have money and try to act poor

I've noticed throughout my college years that lots more people than I thought come from money. Not necessarily generational wealth but enough that they never have to worry about bills and parents can retire while they will still get a good chunk to start out life with (couple hundred thousand). I come from a middle class family total income less than 80kish a year between divorced parents so doesn't go as far as if they were married and will have next to nothing in any sort of inheritance and will probably have to support my parents later on in life. My thing is I've noticed people who have money whenever you mention it to them in a casual setting (not making them flex about it or rub it in someones face. Just a chat about family income/general upbringing) they immediately freeze up and act like OMG I have nothing what do you mean or hahaha I have no money, meanwhile mommy and daddy have a hefty chunk of change for the kid when they get older. I think it's great that people have that financial freedom and thats what I one day aspire to have for my family. So why do people get so uncomfortable and feel like they have to down play themselves. Perhaps some people on the other side of the coin can enlighten me about this phenomena. 

WSO Elite Modeling Package

  • 6 courses to mastery: Excel, Financial Statement, LBO, M&A, Valuation and DCF
  • Elite instructors from top BB investment banks and private equity megafunds
  • Includes Company DB + Video Library Access (1 year)

Comments (62)

  • Prospect in IB - Gen
Jul 21, 2021 - 12:52am

I can understand that, its just interesting to me how it's such a taboo subject yet is an essential component to everyones lives. You could argue it drives a lot of peoples decisions throughout life. Why do you think it's so tasteless to discuss? (I know that opinion is the general consensus) 

Jul 26, 2021 - 3:40pm

I'd also like to add that the "rich kid" has a negative connotation and that the rich kids lack relatability to (literally) 99% of the population. It's also a hard pill to swallow when you're a young man/woman trying to find your identity and realizing you really don't have an identity that, again, doesn't relate to 99% of people and means you won't be able to fit in as well.

Learn More

300+ video lessons across 6 modeling courses taught by elite practitioners at the top investment banks and private equity funds -- Excel Modeling -- Financial Statement Modeling -- M&A Modeling -- LBO Modeling -- DCF and Valuation Modeling -- ALL INCLUDED + 2 Huge Bonuses.

Learn more
  • Analyst 1 in IB-M&A
Jul 21, 2021 - 1:04am

I think there are two sides to this. First, there is the thought that talking about how much money you have doesn't benefit you in any way. People either think you're an a-hole, you are trying to brag or you make others feel 'lesser'. If the person with money doesn't benefit by talking about it, then why would they talk about it?

The other side is that everything is relative. In your eyes, they are really rich, but to who they grew up around and likely the people they spend the most time with they are likely normal. You mentioned that your family income is ~80k. In order to be in the 1% of the world, income needs to be over 30K. You are nearly 3x that. You view yourself as normal wealth. Well, that view is based on who you are surrounded by. The way you look at your friend is how 99%+ of the world, human history for that matter, looks at you. 

  • Prospect in IB - Gen
Jul 21, 2021 - 1:19am

Valid point and I guess everything is always based on perspective and always am grateful for the opportunities I've had. Most of my friends have that same sense of bubble around them. I think some of them lack the awareness that they are much more wealthy than even the general US population. Mentioned to them that the avg US Income is approx 60-70k range and they pretty much said I was lying. I try to understand that even the life I live is most likely better than general US population but they can't seem to wrap their heard around it. 

  • Prospect in IB-M&A
Jul 21, 2021 - 2:08am

My guess is they don't want to come across as snobby or people who see themselves as more important because they have money so they're trying to avoid that whole image and association. 

Jul 21, 2021 - 2:55am

One thing is that it's more of a taboo in America than a lot of other places. In Asia, it's not really taboo, and same for many parts of Europe. In America, it's problematic to be successful according to the liberal consensus so people are more coy about wealth. 

  • Associate 1 in PE - LBOs
Jul 21, 2021 - 5:26pm

hahaha always the democrats fault

Only one party is continuously vilifying the wealthy and successful for "not paying their fair share" when in reality they're probably paying more in total taxes than 90% of their critics. 

  • Intern in Consulting
Jul 21, 2021 - 3:29am

I think there is a multitude of reasons, for background my parents are probably right below the UHNWI definition:

1. My family is extremely frugal (driving cars into the ground). Definitely hints that I didn't pick up until I got older (replacement is a Toyota - but fully loaded and paid in full). So by the time I learned the worth of our assets I had no desire to show off and kinda inherited that frugal mindset. Think poor, act poor I guess. (Should've been obvious from the property values, but I got dropped on my head as a kid and couldn't add up the numbers)

2. Similarly, the concept of money was hammered into me constantly. Paying for activities was never a problem, but I was reminded of the cost. I was taught to budget everything, shop for deals. Cell phone, computer, etc all paid for by myself. No way we were rich! (Of course, that's the mindset when you see the kid with straight Cs gets an Audi for their 16th). 

3. As others in the thread have mentioned, it's all relative. One of my elementary school friend's dad was a partner at a top VC who daily'd a supercar, another friend's family got a Model S the first MY it came out. My dad was "just" some senior F500 engineer, who happened to have a few startup exits that he never talked about. For this reason, I never saw us as rich. Like Analyst 1 said, my family's income is pretty low for where I grew up so I thought we were middle class at best. Yet, my family was one of the few that actually owned our house... and a few other houses. 

4. It's also just... taboo. The rest of our close family combined will probably make less yearly than my dad's monthly portfolio returns. My parents grew up poor. I'm grateful for what they've given me but I'd much rather make my own fortune than rely on theirs, and I certainly don't want to be seen as someone who relies on their money. I think this is common - something I heard someone say about success is a lot of people want to 2x their parent's accomplishments.

Dunno if this made sense, tried to articulate my POV but it's late and I'm tired as shit. If I didn't answer your question let me know and I'll try again with coffee this time.

  • Prospect in IB - Gen
Jul 21, 2021 - 12:03pm

All makes sense, and I get that think poor and act poor mindset. Have the upmost respect for people who live like that and have an understanding of moneys value. The people I'm referencing though are the one's with designer clothes or high end stuff who never had to work. Also they tend to lack any understanding of how far money goes and have no concept of real world salaries and expenses. If that makes sense?  

  • Intern in Consulting
Jul 21, 2021 - 12:39pm

I haven't really encountered those people saying they have no money, but I can see it happening. I think a fair guess would either be their surroundings growing up (everyone buys/wears XYZ designer brand, so that's normal) and they really don't consider themselves rich. Or just around the general wealth disparity in this country. Who wants to be the one talking about how their family has $10m in property while the guy across the table can barely pay rent, is on 72mo financing for his car, and is in student debt for the next two decades?

Jul 27, 2021 - 7:15pm

Similar situation to you.  I'm from an upper middle class family but my parents were frugal and a lot of emphasis was on saving money.  We could afford some luxuries but we never went through and only spent some extra money on home renovations.  

Especially as a teen I was pissed cause most of my friends (upper middle class neighborhood too) were getting fresh gadgets, cars, and designer clothes. But I am very glad for that upbringing and still have that mindset. 

Jul 21, 2021 - 8:01am

When many tv show, movies, celebrities, and half of this country's public figures attack the one percent, the privileged, the affluent, and YT and his YT Karen wife in an expensive SUV with their children who are blamed for ruining inner city education, why would anyone admit to being from a prosperous family outside a need to know basis?  

Jul 21, 2021 - 10:39am

what I've noticed is the following. bear in mind I deal with very few who grew up with, most who are upper class in my clientele grew up without or middle/working class

first, they know what the other side is like, they've lived it, and that could be where they're most comfortable. not growing up around wealth may embarrass you to some extent when among people with smaller balance sheets but better cotillion than you. while I don't have wealth, I find myself feeling this way when around stuffy rich people who likely inherited their money

second, they had to live below their means to build wealth so it's drilled into their psyche that you must live on less in order to succeed. whether this is an entrepreneur taking a small salary just to make ends meet, an executive who lives off 50% of cash comp and saves everything else, or a physician who had to pay her way 100% through school and so never felt secure during the "keep your head down, work hard, save, and pay off these loans" until her late 40s when she realizes she's a multimillionaire

third, anyone with wealth has seen people lose wealth so they know they're one bad decision away from losing it all. whether that's a bad financial advisor, backing up the truck in investments that go sideways, a lawsuit, a divorce, etc., they know intuitively it's temporary and behave as such. it's easy to be the guy with $10mm pretending to be $5mm and loses $5mm (he's already used to that lifestyle), than be the guy with $10mm who loses $5mm and has to downgrade his lifestyle

fourth, if they're self aware they realize that success is a mysterious equation of hard work and luck, not all one or the other, and while I firmly believe the harder you work the luckier you get, had I gotten into a car accident in my teenage years, fallen into the wrong crowd, knocked up a chick, etc., I wouldn't be where I am today most likely, so perhaps they view puffing up their chest as a bit arrogant, because while they don't agree with obama's "you didn't build that" they do realize that life has many twists and turns and theirs could've gone very differently. for example, even if those early in life things didn't fuck you over, what if you just joined the wrong company, say you left AMZN in 98 to go work for Yahoo and got all of your stock options replaced there, you would most certainly not be in the same category of wealth

finally, because it's douchey to flex. humility is a cardinal virtue for a reason, pride was thought to be the root of all sin by St. Thomas Aquinas, and because in conversations that enter the hierarchical (inevitable if money is brought up), there's one winner and the rest are losers, so self-aware wealthy people diminish their own status to meet others where they are and appear equal, even though they are not, conversation doesn't work any other way. I can tell you this for certain because I can see my clients' balance sheets which are aspirational for me, but when we're together, we're equals, so it works

  • Prospect in IB - Gen
Jul 21, 2021 - 12:04pm

I've noticed that living below your means with the people who truly understand moneys value and don't just throw it around for fun 

Jul 21, 2021 - 12:51pm

Layering on to some of the things above (brofessor brings up great points as always) there's a growing trend of wealth-shaming going on in the West. In Germany it's quite pronounced where I remember reading one family with high 9 figures net worth threatened to sue a paper because it said they were billionaires. Pretty funny because here in the U.S. it's the opposite thing

This wealth-shaming trend probably just began to hit the U.S. after the financial crisis and has slowly been building. In 20yrs in the U.S. it will be far worse than it is today with hyper left people decrying wealth as inherently evil & then trying to shame you for it. Which is why LT you see rich people mainly / exclusively have rich friends. You have shared context / upbringing and you won't be judged for having wealth.

Jul 21, 2021 - 2:28pm

100% of those are liberals who love to identify themselves as ''victims'' of the system.

Never discuss with idiots, first they drag you at their level, then they beat you with experience.

Jul 21, 2021 - 4:33pm

I come from a situation like this. My parents paid fully for my college and basically gave me a couple hundred thousand to do whatever the fuck I want with it.

What would you want someone like me to do? Brag about it constantly? Flex it? I'm aware most kids my age don't have parents making half a mil and they also tend to accrue a lot of debt after college. I'm not that socially unaware to bring up how financially well off I am for none of my own doing; I try to live within my means as well, so it's not relevant to randomly tell people how much money I have sitting in my account. And once you tell your friends or other people about how much you have, they start bringing it up EVERY TIME.

Unfortunately, I have a lot of experience with this. Suddenly you're the "rich kid" which means you have to pay for other people's shit whether you like it or not. I'd rather not have to deal with that. Anyway the reason my parents were able to provide so much for me is because they saved an invested wisely.

Jul 22, 2021 - 3:03am

Probably the same reason the local high school kid who got into Harvard does not wear a Harvard sweatshirt around his high school friends. You look like an asshole. 

Why would you flex the H sweatshirt in front of all your friends going to (insert Tier 3 geographically close to hometown). It is the same way with money. Many people also do not like the fact that they are living life on easy mode due to parental successes. Many of their struggles and efforts are instantly discredited because they come from a wealthy family. This is why I think people hide behind blanket statements when asked about their wealth or prefer to not talk about it.   

  • Prospect in IB - Gen
Jul 22, 2021 - 12:10pm

I understand but to use your example imagine you start talking about the prestige of the school/opportunities at each and the Harvard kid starts saying it's the same level as the tier 3 school you're going to. That's where I feel it becomes disrespectful and inconsiderate because everyone knows thats not the truth. 

Jul 22, 2021 - 3:42pm

I understand but to use your example imagine you start talking about the prestige of the school/opportunities at each and the Harvard kid starts saying it's the same level as the tier 3 school you're going to. That's where I feel it becomes disrespectful and inconsiderate because everyone knows thats not the truth. 

This is probably a situation in which a little more context is necessary.  For someone to say "oh yeah, Harvard sucks, I wish I was going to [insert other school here]!" is obnoxious, I agree.  To say "well, we'll all have an opportunity to get a higher education and a degree, after all" doesn't seem quite so egregious.  At some point, part of the shared mythos of being American is that we live in an egalitarian society.  However untrue that may be in practice, it's one of those small social fictions we all agree to buy into to some degree, because it's so deeply embedded in the national character.

Jul 22, 2021 - 10:15pm

Mate, being proud of Harvard is different than being proud of your family's wealth.  One is something you had to work your ass off for, the other is something you inherited.  If your friends aren't happy for you then they're some shitty and bitter friends ngl

Jul 23, 2021 - 2:28am

An Average American has an income of $30k before taxes

$30k = 50th Percentile = Median

(Yes, I know that 'Average' and 'Median' are not the same).

I sense most people on this forum do not realize this.

"Villifying The Rich" has been dialed up, because for the past 40 years The Rich have gotten richer while the Bottom 80% of Americans have seen their wages in real terms go down.

Corporate Machiavelli

  • 1
  • Intern in IB-M&A
Jul 24, 2021 - 12:48am

go on reddit for 1 nanosecond and you will see people bashing the top 1%

Jul 24, 2021 - 4:32am

No one who's not an asshole wants to be defined by their wealth. I don't think most people who are wealthy "act poor", but are reticent to share with people they are loaded as it usually creates preconceived notions from others. 

Jul 24, 2021 - 4:12pm

So my dad is a factory executive in a typical poor post-industrial US town, mom is an engineer, and they also own a small business.  Not exactly 1% but they bought a cheap country house and don't really have anything to spend their money on besides their kids.  So I didn't grow up working class at all but I also was not living in some super rich enclave

It can be awkward at times.  For example a lot of my friends were busting ass all summer in HS trying to get a car while my parents just bought me one for Christmas.  So if I were to brag about it, they'd feel bad.

  • Intern in PE - Growth
Jul 26, 2021 - 7:02am

>be me

>be self-hating Upper Class

>become insufferable SJW

>pull down quality of WSO

Like clockwork. Commies truly aren´t human.

Start Discussion

Total Avg Compensation

July 2021 Investment Banking

  • Director/MD (10) $853
  • Vice President (36) $363
  • Associates (210) $232
  • 2nd Year Analyst (121) $152
  • 3rd+ Year Analyst (28) $146
  • Intern/Summer Associate (102) $144
  • 1st Year Analyst (449) $132
  • Intern/Summer Analyst (358) $82