Feeling secure is about more than money

Some of the angriest phone calls I've gotten from readers have come from well-off ­people who say their hard-earned success hasn't been shown enough respect.

These are callers like the people who say they don't like reading skepticism about a tax break that mainly benefits affluent people who save money for their kids' college educations.

Please try to understand, they say, we're not really rich. How could we possibly be criticized for enjoying a tax benefit that rewards us for actually saving money?

These conclusions about their affluence are not just guesses, either, because the readers who phoned were happy to share. They explained how hard they had worked to pull together even a little bit of wealth.

Looking back, it's clear that what's really bothering most of these folks, even if they don't really understand it themselves, is that they are rich but still don't feel quite rich enough. They've gotten ahead, but their comfortable lifestyle and net worth feel so fragile.

These conversations came to mind again when reading through a report that the U.S. investment services arm of UBS recently put out — a starkly pessimistic survey of the ­affluent that featured a treadmill on its cover.

In this report, UBS had surveyed more than 2,200 "millionaires," meaning the folks with at least $1 million in net worth.

Inflation has devalued the term millionaire, maybe, but it's still just a small slice of Americans. The net worth to get into the top 5 percent of American households starts at about $1.9 million, according to Federal Reserve data.

There has been plenty of research that shows that financial plenty doesn't provide much of a bump in happiness, but UBS found its millionaires were generally really satisfied with their lives. On other hand, UBS also found that they were just a ball of worry.

"Though two-thirds of millionaires say achieving financial security is the whole point of working to build wealth, only the very wealthy feel they have enough to be secure," the report said. "Half of millionaires with less than $5 million — and 63 percent of those working with children at home — believe that one wrong move, such as a job loss or market crash, would have a major impact on their lifestyle."

It's one reason why, whatever money a person had, UBS reported that "the majority of millionaires want more. Those with $1 million want $2 million; those with $10 million want $25 million."

It's difficult to imagine anyone not feeling pretty set at $10 million in net worth, but building enough wealth seems to be a game where the goal line keeps moving.

There are plenty of personal finance writers who nevertheless seem to want to give advice on how to cross the goal, trying to help people figure out how much is enough. The odd part is that the writers all seem to think the answer somehow lies in just amassing enough dollars and cents.

One message is that it takes a lot more than many people may think — if a person with a net worth of $1 million doesn't feel secure.

Sure, having the money beats not having it, but even in an investment account that yields 5 percent a year, itself quite a feat these days, that million only spins off $50,000 of pretax cash each year.

You are a millionaire who still has to go in to work on Monday morning.

While this kind of advice may be well-intentioned, the problem with this whole exercise of finding the right number to feel "secure" is that there are all sorts of hard-wired parts of our thinking that get in the way of ever getting there.

There's hedonic adaptation, the process of becoming used to nice things you have and no longer deriving much satisfaction from them. Then there's loss aversion, which basically just means the pain of losing something you once had outweighs the good feelings you got when you acquired it in the first place.

There's probably a little self-serving bias at work here, too. That's the little mental process running unnoticed in the background that leads us to give ourselves the credit for all the good things we enjoy, while all the bad things that happen are the fault of somebody else.

There are probably a few more biases that affect how secure people feel with their money, too, and so it's actually not that hard to understand how UBS could easily find millionaires who think they can't ever slow down.

It might be time for people running on the treadmill to step off and look somewhere else besides the likes of UBS for good financial security advice. Put down Kiplinger's or Money magazine, and stop loading personal data into the "Do You Have Enough?" calculators on the Internet.

Security really isn't a financial question. It's more a spiritual one. No one reads an economics and business columnist for spiritual advice, but happily there's no shortage of other places to turn.

What's clear is that if a big number after the dollar sign on an investment account statement is what you really think can make you secure enough to sleep well at night, then my advice has to be that you keep up the hard work.

That's because I'm pretty sure even $10 million isn't going to be enough.

lee.schafer@startribune.com • 612-673-4302