The Prestige-Prosperity Gap

In an ideal world, prestige and wealth rise hand in hand. But the modern world of ambition is a lot messier.

If the Old American Dream was being able to go from nothing to middle class, the New American Dream is to go from middle class to wealthy, well-respected, and well-known. I could write an entire essay on the “New American Dream,” but for now, I want to talk about a phenomenon I’ve noticed among people chasing it.

In an ideal world, prestige and wealth rise hand in hand. But the modern world of ambition is a lot messier. The reality is often a bizarre mismatch where some people find themselves with more of one than the other, sometimes a lot more. Plenty of people are prestige rich, cash poor. And plenty others are cash rich, prestige poor. It’s relative: which do you have more of relative to expectation?

You probably know people like this (or maybe this is or was you in a past phase).

Note: I am knowingly using prestige, status, and social capital somewhat interchangeably even though they have subtly different meanings. While status is more fleeting than prestige, both can be independent of financial wealth in modern, internet-focused communities. I use prestige here because I’m focused more on earning enduring respect through achievement rather than status from more fickle means (e.g. viral fame).

Prestige Rich, Cash Poor

I first saw the prestige rich, cash poor phenomenon in medicine.¹ As soon as you’re accepted into medical school, your prestige skyrockets, but your bank balance doesn’t go up even a dime (or it goes negative to pay for school). When you graduate to medical residency, you start with a salary of $50-60K (and it barely increases over the next several years of training).

A prestigious education is supposed to boost your wealth, but it often lags behind for years, sometimes even decades. This happens in the workforce too, especially in academically-inclined fields. Scientific researchers aren’t rolling in cash, and the memes about how little PhDs get paid are sad-funny. In the end, for many doctors, medicine offers more prestige than wealth (again, relatively speaking).

Startups, especially the recent era of aggressively venture-backed startups, are a hotbed for this kind of thing too. Founders, employees, and small investors of hyped-up startups often find themselves prestige rich, yet relatively cash poor. Some have given up on their bets ever translating to real wealth, while others are still holding out hope for their stock options to become liquid, i.e. turn into cash.

Cash Rich, Prestige Poor

Now, on the flip side, we have the cash rich and prestige poor — people with money but not as much earned status as you’d expect. How can this be? Wealth used to be the predominant avenue for influence in a society, but this is no longer true. Credibility, access, attention have been decoupled from money to a tangible extent.

It’s also easier today to live a low-profile life as a wealthy person than it was decades or even centuries ago. Everything about you used to be easily triangulated — via family history, profession, and town gossip. But many people no longer live in small, insular towns where everyone knows everyone. So having money doesn’t automatically maximize your prestige; you still have to cultivate it.

In startup land, these people are often successful founders or investors in less “flashy” sectors. Or they’re the ones who’ve achieved “middle” outcomes during an era where only the biggest ones were noteworthy (e.g. the unicorn valuation and IPO-or-bust era). Industries like finance seem to harbor many of this type too.

Why the mismatch?

People generally expect you to have both prestige and wealth or neither. So being more of one and less of the other brings practical and emotional challenges. The mismatch causes cognitive dissonance, stress, anxiety, and more for some people. It can feel like a twisted kind of imposter syndrome. And it seems like this mismatch is an increasingly common phenomenon in entrepreneurial societies.

Modern times give us more ways to chase the ideal in the extreme— by chasing attention (e.g., social media) and making big bets (e.g., stocks and startups). These modern paths feel reasonable because so much of the new world seems ruled by people who emerged from nowhere to get the most views and the biggest financial windfalls. The stories of big winners lure new players into the game.

The more extreme the opportunities to gain prestige and gain wealth, and the more plentiful these opportunities become, the more this mismatch shows up. This mismatch can feel like a kind of trap because it feels like you’ve half-won, but the other half is always just out of reach (or at times, still very far away).

Which way out?

Some people will tell you that if you’re ever prestige rich but cash poor, get out as fast as you can. That status is as fleeting as a tweet. Reputation, attention, audience are only as valuable as what you can convert them into — money or opportunity. (After all, the rich at least get to live their life in comfort and then chase prestige to their heart’s content, if they even want or need to.) They’ll tell you don’t chase prestige at the expense of wealth. That prestige can open doors, but only money lets you walk through them on solid ground. And there’s a lot of good advice here.²

Others will tell you something different. That being prestige rich but cash poor is a great place to be. That you should become an expert at something, earn respect from a respected few, build an audience, secure attention, and the rest will follow. That you should work for the man for a few years, even if for little pay, because you’ll earn it back in experience, wisdom, and future open doors. They’ll tell you that in our modern times, it’s easier to turn status capital (of many kinds) into financial capital than the other way around. And there’s a lot of good advice here too.

I’m not one to say that one matters a lot more than the other or that you shouldn’t care about having either. Prestige and prosperity both have their worldly benefits. When you have a steady salary, you seek prestige. When you have prestige, you seek money. As humans tend to, it’s easy to forget what you have and chase more of what you don’t. It’s easy to strive to win as many games as you can. Where have I ended up? Perhaps there’s a threshold amount of each that’s reasonable to aim for.

In the end, the dream of perfectly aligning prestige with wealth is just that — a dream. Even those who seem to have both in spades feel an imbalance. So, in my mind, the wisest thing: Appreciate what you have. Don’t stress about eradicating the mismatch (it’s impossible). Accept that you’ll always have more of one than the other, though which one and by how much can change. And then decide how you want to play the game of leveling up one or both, if you want to play it at all.

Thanks to Bharat, Jayson, Edmar, Stefan, Matthew, Amit, Jake, and Corey for feedback on an earlier draft of this piece, shared in Writers Block. :)

1. When I say poor, I don’t mean poverty in the strict sense, so take this as a light metaphor.

2. The game of accruing prestige or wealth can be bundled with accruing skill, but treat this as a different third thing that’s independent and that you should always be chasing.