• by Stephen Kraus , Op-Ed Contributor, October 17, 2012

This month, a closer look at Affluents and their money, using data from our just-released 2012 survey…

Defining Affluents as the 59 million U.S. adults living in households with $100,000 or more in annual household income (HHI), we find they average $192K in HHI, and their average of $500K in liquid assets is spread across a variety of accounts. Essentially, all have a banking (checking/savings) account, and nearly as many (87%) have a retirement account, including 63% with a 401K. They have a variety of insurance accounts as well, with personal insurance being the second-largest category of Affluent expenditures (behind automotive).

Most Affluents could be described as “self-directed” in the broadest sense of the term. This includes both embracing an ethic of personal financial responsibility (72% agree, “A person is responsible for his or her financial security after retirement”), and being “hands-on” in their day-to-day financial management (69% agree, “I am actively involved in the management of my personal finances”).

Being self-directed, however, doesn’t necessarily mean “going it alone.” More typically, it means leading a financial team, charting a course, and selectively bringing in those with expertise in particular areas. Consider that a majority of Affluents (62%) use the advice or services of some kind of financial professional, with brokers and tax consultants being the most widely used. Segmentation, as always, is critically important, as a substantial minority of Affluents have deeper relationships with financial professionals. For example, 23% agree, “I usually consult a financial expert before deciding on money issues.” More elite services appeal to smaller segments with particularly high income and assets, such as use of private bankers (6%) or wealth advisors (3%).

Segmentation is particularly important when considering risk tolerance as well. Affluents as a whole skew somewhat cautious, with 42% agreeing, “I would describe my approach to investing as conservative and risk-averse,” while only 18% disagree. Nearly one-third (29%) go further, agreeing “The stock market is too risky for me” (31% disagree). Still, at a more granular level, Affluent interest in specific sectors and investments is diverse, encompassing options across the risk spectrum.

This broad portrait of self-directed prudent investors certainly describes many Affluents, though not all. Still, given the general complexity of their financial lives in these economic times, the opportunities for financial service offerings remain strong.

Next month, in Part 2 of “Money on their Minds,” we’ll take a deeper look at the financial products and services that most interest Affluents, and how these interests reflect broader opportunities for connecting with Affluents across categories.