Psychologist explains how your environment affects your income

Your environment affects your income, but not in a straightforward way

The idea that simply surrounding yourself with wealthy people is enough to increase your income oversimplifies the real picture, said Elena Shpagina, Candidate of Psychological Sciences and associate professor at the Department of Humanities and Social Sciences at the RTU MIREA Institute of Advanced Technologies for Manufacturing, in a conversation with Gazeta.Ru. According to her, a link between one's environment and earnings does exist, but it does not work as straightforwardly as popular coaches promise.

What the research shows

Shpagina cited several observations. Children who had a classmate from a well-off family earned more in adulthood, and the effect was strongest for those who themselves grew up in low-income families. If a person of a certain profession lived near a child, the likelihood that the child would choose that profession thirty years later rose by roughly ten percent. Living near people in high-paying professions — for example, doctors or lawyers — provided a boost to income and level of education even compared with other children from the same street.

How it works and where the trap lies

The pattern is explained by the fact that people adopt the financial behavior of those around them: refugees who were resettled in areas with a large number of educated residents more often began investing and opening retirement accounts. Social networking also plays an important role — building connections without which it is impossible to achieve high career results; for young people, the psychologist named the university student environment as one of the key social circles, since student friendships often form the basis of career connections.

The flip side and the practical takeaway

There is also a flip side: people tend to socialize with those similar to themselves. For those who grow up in a less affluent environment, this creates a trap — they less often come into contact with people who could pass on useful knowledge, and even when they do, they are not always able to interpret the information correctly. Shpagina suggested starting small: reading books and listening to lectures by those who have already achieved the desired result, and attending professional events in one's field. 'Your environment is not only the people you have dinner with. It is also those whose ideas you let into your head,' she concluded.