IQ And Income: Are Smart People More Wealthy?

Smart people are not that much more wealthy, but people with high IQs do have higher incomes.

Smart people are not that much more wealthy, but people with high IQs do have higher incomes.

Being smart has almost no relationship to wealth, research reveals.

People with high IQs are no more wealthy than those who are considerably less smart, on average, a study has found.

Perversely, very clever people are actually at a slightly higher risk of financial problems.

Dr Jay Zagorsky, the study’s author, said:

“People don’t become rich just because they are smart.

Your IQ has really no relationship to your wealth.

And being very smart does not protect you from getting into financial difficulty.”

This may explain why there are so many rich people with low IQ and poor people who are highly intelligent.

High IQ = higher income

The slight wrinkle is that people with higher IQs do tend to have a higher income.

As Dr Zagorsky explains, though, that income is different from wealth:

“Financial success for most people means more than just income.

You need to build up wealth to help buffer life’s storms and to prepare for retirement.

You also shouldn’t have to worry about being close to or beyond your financial limits.”

Research on IQ and income and wealth

The conclusions come from 7,403 people in the US who were tracked for almost 40 years in a nationally representative survey.

It found that the income difference between someone of average intelligence and someone in the top 2 percent is only around $12,000 a year.

However, people of average intelligence had similar amounts of wealth as the more intelligent.

So, how come intelligent people earn more, but are not more wealthy?

This study can’t tell us, but it might be that high-IQ people are not saving as much.

Dr Zagorsky said:

“Just because you’re smart doesn’t mean you don’t get into trouble.

Among the smartest people, those with IQ scores above 125, even 6 percent of them have maxed out their credit cards and 11 percent occasionally miss payments.

Professors tend to be very smart people, but if you look at university parking lots, you don’t see a lot of Rolls Royces, Porsches or other very expensive cars.

Instead you see a lot of old, low-value vehicles.”

This might also suggest that professors — and other intelligent people — have different values and aspirations in life.

Dr Zagorsky concluded:

“Intelligence is not a factor for explaining wealth.

Those with low intelligence should not believe they are handicapped, and those with high intelligence should not believe they have an advantage.”

The study was published in the journal Intelligence (Zagorsky, 2007).


Get FREE email updates to PsyBlog

Hello, and welcome to PsyBlog. Thanks for dropping by.

This site is all about scientific research into how the mind works.

It’s mostly written by psychologist and author, Dr Jeremy Dean.

I try to dig up fascinating studies that tell us something about what it means to be human.

Get FREE email updates to PsyBlog. Join the mailing list.

Author: Jeremy Dean

Psychologist, Jeremy Dean, PhD is the founder and author of PsyBlog. He holds a doctorate in psychology from University College London and two other advanced degrees in psychology. He has been writing about scientific research on PsyBlog since 2004. He is also the author of the book "Making Habits, Breaking Habits" (Da Capo, 2013) and several ebooks.