What if money could buy happiness?
“Money can’t buy happiness… but it can buy cows. And cows make milk, and milk makes ice cream, and ice cream makes you happy.
It’s the kind of wisdom you learn in a Colorado bookstore while on vacation. Maybe it looked slimmer, but after laughing I thought to myself, “Wait a minute… that’s really true. “
Happiness is big business. Our founding fathers defended it as an inalienable human right, a gift from the Creator that we should be free to pursue.
Obviously when we say things like “Money cannot buy happiness” we understand that to mean “and other forms of wealth also cannot buy happiness”. That would explain the miserable billionaire in his spectacular 20,000 square foot mansion.
However, as comedian Leo Rosten noted, while money cannot buy happiness, “neither can poverty.”
What does the research say? In 2010, Nobel Laureate Daniel Kahneman and Angus Deaton published a study showing that happiness actually increased in individuals as their incomes increased, but only up to around $ 75,000 ($ 90,000 adjusted for inflation today).
According to the study, income above this amount can buy “satisfaction” but not real happiness.
Perhaps this curious connection between financial well-being and emotional state of mind is best illustrated by an old story about a poor Mexican fisherman and a wealthy American tourist.
The fisherman described his simple life as follows: “Every day I sleep late, I fish a little, I play with my children and I take a nap with my wife. In the evening, I go to the village to see friends, I have a few drinks, I play the guitar and I sing a few songs. I have a busy life.
The American frowned, “Sir, I have an MBA at Harvard. Can I offer some advice? If you fished a little longer each day, you might catch more fish. You could then use that extra income to buy a bigger boat. That way you could catch even more fish, buy a second boat, and then a third. You will eventually own a fleet of trawlers. Soon you could bypass the middleman, negotiate directly with the processing plant, or even open your own plant. In time, you can leave your village, move to Mexico City, and build a fishing empire!
“How long would all of this take?” asked the fisherman.
“About 20 or 30 years.
” So what ? “
“Well,” replied the MBA, “You could retire to a small village, sleep late, fish a little, play with your grandchildren, take a nap and spend your evenings drinking and enjoying the company of your friends.”
So what conclusions can we draw about money and happiness?
1. Happiness is a big deal in life. While we might define it differently, its pursuit is what drives us.
2. Certain “ice creams” can make you happy. Too much will make you sick.
3. Ultimately, it’s not money that makes us happy. It’s the cows. (By “cows,” I mean, of course, the material assets, opportunities, and experiences that require money for us to take advantage of.)
You would think that a financial planner would push you to make more money. But what good is it if the pursuit of this wealth does not lead to true happiness?
Do this: Be clear about what the “cows” are in your life… the things that contribute to your deep happiness.
Once you know your cows, you can direct your money in the right direction.
One useful tool is my new eBook “How to Put Money Worries in Your Rearview Mirror – The Roadmap to Financial Freedom”. It’s free and a quick read. Email me at [email protected] and I will get it to you immediately.
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