The Surprising Reason Why Newly Wealthy Clients Become So Controlling

18 September 2023
32 min listen


Many retail financial advisors work with clients who create wealth by owning and growing a thriving business or by managing a successful career. In most cases, these clients labored for years to become financially secure, but many achieve significant wealth because of a particular event. When this happens, advisors are often surprised that the client suddenly becomes less trusting and more controlling. 

Scott and Ken explore the psychological factors that influence an investor who experiences a sudden windfall of wealth that transforms her life. Specifically, the concept of a locus of control is considered. When a business owner runs her business, she experiences having personal control over the success of that business. But when she sells the business, the locus of control over her financial security shifts from herself to the advisor who must now manage the wealth. The podcast explores how this shift from an internal to external locus of control affects the investor and practical ways that advisors can respond creatively to this experience.

The information contained herein reflects the views of AllianceBernstein L.P. or its affiliates and sources it believes are reliable as of the date of this production. AllianceBernstein L.P. makes no representation or warranties concerning the accuracy of any data. There is no guarantee that any projection, forecast or opinion in this material will be realized. Past performance does not guarantee future results. The views expressed here may change at any time after the date of this publication. This video segment is for informational purposes only and does not constitute investment advice. AllianceBernstein L.P. does not provide tax, legal or accounting advice. It does not take an investor's personal investment objectives or financial situation into account; investors should discuss their individual circumstances with appropriate professionals before making any decisions. This information should not be construed as sales or marketing material or an offer or solicitation for the purchase or sale of any financial instrument, product or service sponsored by AB or its affiliates. References to specific securities are presented solely in the context of industry analysis and are not to be considered recommendations by AB. AB and its affiliates may have positions in, and may affect transactions in, the markets, industry sectors, and companies described herein.

About the Authors