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Quantifying What Success Means, According to 2,000 Americans

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The pursuit of success is a part of our cultural DNA.

Almost everyone wants to be successful – and many see it as the basis of the American Dream, which promises that every person can achieve success and prosperity through hard work, determination, and initiative.

However, despite a drive for obtaining success in our culture, the meaning of success isn’t fixed. It can be different things to different people, and there is no possible way of defining success in a way that is representative of every individual person.

Quantifying Success

Although there’s no objective definition of success, there are other ways to arrive at a more impartial meaning.

Today’s infographic from Thermosoft uses data from a survey of 2,000 Americans to show what “making it” means to them – and in the process, it gives us a baseline for what success means to the average person.

Quantifying Success: What It Means, According to 2,000 Americans

Survey respondents were asked what “making it” in America meant to them, and then that was compared to what they have.

A variety of individual factors were measured, and each fell within certain categories that could be important to one’s success, including career, family life, wealth, and travel.

Success, on Average

The survey data gives us a view of what success means, on average – and how close people are to “making it”.

Money
Respondents viewed $147,104 of income as “successful”, and this is the area people were furthest away from their ideal.

The average income of respondents was $57,426 – and 67% of respondents said that money was the major missing part of their equation for success.

Work
Respondents viewed 31 hours of work per week, a 10 minute commute, 5.3 weeks of time off, and working more from home as their ideal situation.

However, respondents were a little off on most of these measures, and far off for vacation time. The average person is working 34 hours per week, commuting 17 minutes, taking 2.8 weeks of time off, and working more from the office.

Notably, for 22% of people, a dream job was the missing part of their success equation.

Friends and Family
Respondents viewed marriage and kids, as well as four best friends, as ideal. On average, respondents fell slightly short here, though.

Property
How much would your home and vehicle be worth, if you “made it”? About $461,000 and $41,986 respectively.

Respondents fell short here, with $248,000 and $15,789 values for their home and vehicle.

What’s Missing?

Since success is subjective, the sense of what is “missing” varies considerably.

On average, income was the most important missing factor (67%) and a dream job was also a popular response (22%). Relationships and recognition were both 7%, respectively.

Answers also varied by group – for example, millennials were more likely to say their dream job was the missing factor.

While success may never be defined exactly for all people at all times, this is still an interesting amalgamation of the views that people have towards the subject.

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Investor Education

Why Investors Should Rethink Traditional Income Strategies

Traditional longer-terms bonds are no longer as effective—so which additional income strategies should investors be considering?

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income strategies

Why Investors Should Rethink Traditional Income Strategies

Humans are creatures of habit. We all have daily routines, whether it’s walking the same lunchtime route, watching a familiar TV show, or cooking the same meal over and over again. Once we develop a pattern, it can take a drastic change to convince us to rethink our approach.

One such shake-up to ingrained investment habits is the changing landscape of income investing.

In today’s infographic from New York Life Investments, we explain why traditional long-term bonds may not be as effective as they were in the past, and which additional income strategies investors can consider.

The Status Quo

For years, investors have relied on traditional longer-term bonds as the centerpiece in an income portfolio. These debt instruments usually pay out interest to investors on a predetermined schedule, providing a steady income stream investment. Historically, they have also been subject to less volatility than equities.

The typical bond portfolio is diversified, much like the Bloomberg Barclay’s U.S. Aggregate Index. Here’s how the sectors are broken down in the index:

SectorMarket Value
Treasury39.5%
Government-Related5.8%
Corporate25.0%
Securitized29.7%

Unfortunately, this income strategy has been less effective in recent years. Over the last decade, core bond duration has increased by 1.5 years while yields have decreased by almost 2%. Essentially, interest rate volatility has increased—but investors are less compensated for the risk.

In light of low rates and higher expected market volatility, it’s critical that investors explore other income solutions. Luckily, there are many lesser-known asset classes for investors to consider.

Additional Income Strategies: An Investor’s Choice

When investors decide how to re-allocate, they can keep these objectives in mind:

  1. Preservation of principal (risk level)
  2. Pursuit of capital (growth potential)
  3. Perseverance in markets (long-term objectives)

Which additional income strategies can they explore?

Taxable Municipal Bonds

Issued by state and local governments, the yield of taxable munis has historically been higher than that of other sectors. Taxable munis also have a strong credit rating—over 76% of U.S. municipal bonds outstanding are A+ rated or better.

Insured Municipal Bonds

Investors can get additional downside protection with insured municipal bonds, which are guaranteed to pay interest and principal back by private insurers. They have historically performed similar to munis while capturing less of the “downside”, often providing an attractive risk-adjusted return for income investors.

Short-duration, High-yield Bonds

Bonds with a shorter duration and higher yield can be a lower volatility approach to achieving the same income investing goals.

Yield and Risk in Bonds (July 1, 2014 – June 30, 2019):

Bond TypeYieldStandard Deviation (annualized)Yield per Unit of Risk
U.S. Aggregate Bonds2.492.940.85
High Yield Bonds6.055.601.08
Low-duration, High-yield bonds5.003.901.28

Short duration funds have lower interest rate risk, and can offer attractive yield per unit of risk.

Yield-Centric Equities

Equities can also play a role in an income focused portfolio. Investors should look for established companies that are achieving:

  • Growth in free cash flow
  • Stable or growing dividends
  • Share buybacks or debt reduction

Over the last 40+ years, the annual compound return of stocks with growing dividends have outperformed dividend cutters on the S&P 500 by more than 4%.

Preparing for Your Future

Maximizing the benefit from new income opportunities can take time. For this reason, it’s important to consider potential portfolio changes now, so that these strategies can play out in the lead up to retirement years.

It may be tempting to stick with the status quo—both in daily routines and investment strategies—but those who proactively adjust their approach will be able to maximize their potential.

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Chart of the Week

Chart: Which Universities Have the Richest Graduates?

Today’s chart ranks the top 25 universities in the world by ultra-high net worth (UHNW) alumni and total wealth. Does your institution make the cut?

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Chart: Which Universities Have the Richest Graduates?

Higher education is often considered the first rung in the ladder of success.

That’s why thousands of students flock to top-tier universities around the world, hoping to translate their degrees into financial outcomes. After all, a degree from specific institutions can often mean that a wealthy and secure future is in the books.

With a new fall term just around the corner, today’s chart relies on the third annual Wealth-X report ranking of global universities with the most ultra-high net worth (UHNW) alumni. We’ve also tracked their combined wealth, and how much each UHNW alumni makes on average.

Analyzing UHNW Riches

The Wealth-X database defines ultra-high net worth alumni as those who own at least $30 million in assets. In addition, the alumni figures are based on the actual known UHNW individuals from each university, then projected based on the sample size to predict total alumni within the global UHNW population.

One caveat to note is that both bachelor’s and master’s degree-holders have been considered, while UHNW individuals who may have attended more than one university have been counted twice. With that in mind, let’s dive in.

Upholding a Stellar Reputation

It’s immediately noticeable that a majority of universities on the list are located in the United States, with a high concentration on the East Coast—including the elite Ivy League.

Established in 1636, Harvard dwarfs all its Ivy League counterparts for the richest graduates. Its 13,650 UHNW alumni is double that of second-place Stanford (5,580 UHNW alumni), with twice the total wealth to boot.

One way that Harvard falls short is when average UHNW alumni wealth is considered in this chart, with Stanford beating it by a difference of $170 million per graduate. Regardless, it’s clear Harvard graduates go on to have a significant impact on the world. Notable alumni include political leaders such as former U.S. President Barack Obama, and billionaires such as Michael Bloomberg.

Interestingly, Princeton climbs the charts for total alumni wealth ($1.1 trillion), despite a lower UHNW alumni count of just over 2,000—but this also puts its wealth per graduate at a high of $516 million. Notable alumni from Princeton include Jeff Bezos and Steve Forbes. Meanwhile, Brown and Dartmouth are the only Ivy universities that don’t make the list at all.

Excellence Outside the U.S.

Zooming out, private universities dominate most of this list of richest graduates. In the United Kingdom, Cambridge, Oxford, and the London School of Economics and Political Science (LSE) have over 6,500 UHNW alumni combined. This represents a total of $1.08 trillion in wealth, an average of $174 million per UHNW grad.

Notable alumni and achievements from these institutions include:

  • Cambridge: Isaac Newton, Charles Darwin, Stephen Hawking
  • Oxford: 69 Nobel prize winners, Stephen Hawking, JRR Tolkien
  • LSE: 18 Nobel prize winners, including political leaders

*LSE’s label has been misrepresented in the original report as #26 instead of the actual #25.

Nearby in France, the graduate business school Institut Européen d’Administration des Affaires (INSEAD) has a total of 1,956 UHNW alumni and $356 billion in combined wealth—contributed by CEOs of companies like Credit Suisse, Royal Dutch Shell, Ericsson, and Lego.

It’s impressive that the National University of Singapore (NUS) enters the list, with 1,890 UHNW alumni and an average of $46.6 million to their name. Graduates from NUS have gone on to become Singaporean prime ministers and presidents, as well as high-ranking officials in the WHO and UN Security Council.

Here are the full statistics for the top 25 universities worldwide—does yours make the cut?

RankUniversityTotal WealthUHNW AlumniWealth per UHNW Graduate
1🇺🇸 Harvard University$4.7T13,650$349M
2🇺🇸 Stanford University$2.9T5,580$519M
3🇺🇸 University of Pennsylvania$1.8T5,575$319M
4🇺🇸 Columbia University$1.5T3,925$382M
5🇺🇸 Princeton University$1.1T2,180$516M
6🇺🇸 Massachusetts Institute of Technology$990B2,785$355M
7 🇺🇸 Yale University$777B2,400$323M
8🇺🇸 University of California Berkeley$760B2,385$318M
9🇺🇸 New York University$712B3,380$210M
10🇺🇸 The University of Chicago$707B2,405$293M
11🇺🇸 The University of Michigan$691B1,970$350M
12🇺🇸 The University of Southern California$548B2,645$207M
13🇺🇸 Cornell University$483B2,245$215M
14🇺🇸 The University of Texas at Austin$463B2,195$210M
15🇬🇧 University of Cambridge$390B2,760$141M
16🇺🇸 Northwestern University$389B2,725$142M
17🇺🇸 The University of California Los Angeles$375B1,945$192M
18🇫🇷 Institut Européen d'Administration des Affaires$356B1,965$181M
19🇬🇧 University of Oxford$349B2,290$152M
20🇬🇧 London School of Economics and Political Science$342B1,495$228M
21🇺🇸 University of Miami$309B1,700$181M
22🇺🇸 Boston University$277B1,640$168M
23🇺🇸 University of Virginia$246B1,650$149M
24🇺🇸 The University of Notre Dame$179B2,085$85M
25🇸🇬 National University of Singapore$88B1,890$46M

Where’s the Money, Really?

According to the report, a majority of UHNW alumni from these universities are “self-made” millionaires, who became successful through their own efforts rather than relying on family fortune or social status.

Of course, the name of a university is one step to climb on the ladder. What’s often glossed over is how steep the tuition fees at private institutions are, which can rack up significant student debt over time.

Graduates from Boston University, Columbia University, and Northwestern University relied the most on inheritance for their wealth, between 10-12%. A combination of both self-made and inherited wealth sources are also common for UHNW alumni—and it’s not a stretch to say that it helped them pay off debts before focusing on their wealth creation.

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