Money is not the key to your Happiness.

“Becoming rich does not guarantee happiness. In fact, it is almost certain to impose the opposite condition—if not from the stresses and strains of protecting wealth, then from the guilt that inevitably accompanies its arrival.” – Felix Dennis, How to Get Rich: One of the World’s Greatest Entrepreneurs Shares His Secrets

I used to want to be rich until I found out the real difference between being wealthy and rich. Wealthy people are able to do what they want, when and how they want it – Freedom but most rich people are tied into obligations and responsibilities of trying to amass more riches – they have the money but don’t have the freedom to live life on their terms. Freedom is what we are all looking for but we make choices every day that are either taking us closer or farther from becoming free. Most of us are so poor that the only thing we have is money. Actor and comedian Jim Carrey put it this way: “I think everybody should get rich and famous and do everything they ever dreamed of so they can see that it’s not the answer.”

“I think everybody should get rich and famous and do everything they ever dreamed of so they can see that it’s not the answer.” – Jim Carrey

According to 2010 research conducted by Princeton Academics Daniel Kahneman ( Nobel Prize-winning economist and psychologist) and British economist Angus Deaton ¹, Our Emotional well-being rises with log income, but there is no further progress beyond an annual income of ∼$75,000. After we start earning $75,000 a year, we ultimately recalibrate back to our happiness threshold. The research is based on an analysis of more than 450,000 responses to the Gallup-Healthways Well-Being Index, a daily survey of 1,000 US residents conducted by the Gallup Organization.

They Found that emotional well-being (measured by questions about emotional experiences yesterday) and life evaluation (measured by Cantril’s Self-Anchoring Scale) have different correlates. Income and education are more closely related to life evaluation, but health, caregiving, loneliness, and smoking are relatively stronger predictors of daily emotions. When plotted against log income, life evaluation rises steadily. Emotional well-being also rises with log income, but there is no further progress beyond an annual income of ∼$75,000. Low income exacerbates the emotional pain associated with such misfortunes as divorce, ill health, and being alone.

They conclude that high income buys life satisfaction but not happiness and that low income is associated both with low life evaluation and low emotional well-being.

Emotional well-being refers to the emotional quality of an individual’s everyday experience—the frequency and intensity of experiences of joy, stress, sadness, anger, and affection that make one’s life pleasant or unpleasant. Life evaluation refers to the thoughts that people have about their life when they think about it.

We spend our youthful years trying to amass wealth but we ultimately use the same wealth to care for our health. Author of The Fastlane Millionaire ¹, MJ DeMarco shares some great perspectives on wealth:

“A man is incapable of comprehending any argument that interferes with his revenue.” – René Descartes

Wealth is not authored by material possessions, money, or “stuff,” but by what the author called the three fundamental “F’s”…Family (relationships), Fitness (health), and Freedom (choice). A strategy that requires your life and your dreams to be paid as penance is a sucker’s bet. The Slowlane arrogantly assumes that you will live forever and, of course, be gainfully employed forever. Unfortunately, wheelchairs don’t fit in the trunks of Lamborghinis.”

Every day, people sacrifice their time for tiny nuggets of wealth, where time is the liability and not the asset. Anything that steals time and doesn’t have the power to free time is a liability.

John C. Bogle, the late founder of the Vanguard Mutual Fund Group and creator of the first index mutual fund, begins his book, Enough: True Measures of Money, Business, and Life; with a story about how money is not the key to happiness. He writes:

At a party given by a billionaire on Shelter Island, Kurt Vonnegut informs his pal, Joseph Heller, that their host, a hedge fund manager, had made more money in a single day than Heller had earned from his wildly popular novel Catch-22 over its whole history. Heller responds, “Yes, but I have something he will never have . . . enough.

“The great game of life is not about money; it is about doing your best to join the battle to build anew ourselves, our communities, our nation, and our world.”

In life, we too often allow the illusory to triumph over the real. We focus too much on things and not enough on the intangibles that make things worthwhile; too much on success (a word I’ve never liked) and not enough on character, without which success is meaningless. Amidst the twenty-first-century pressures for immediate satisfaction and amassing information on demand, we’ve forgotten the enlightened values of the eighteenth century. We let false notions of personal satisfaction blind us to the real sense of calling that gives work meaning for ourselves, our communities, and our society.

Some men wrest a living from nature and with their hands; this is called work.
Some men wrest a living from those who wrest a living from nature and with their hands; this is called trade.
Some men wrest a living from those who wrest a living from those who wrest a living from nature and with their hands; this is called finance.

In his thought-provoking book, The Psychology of Money: Timeless lessons on Wealth, greed, and Happiness, Author and Partner at Collaborative Fund , Morgan Housel writes about the pursuit of freedom as the ultimate dividend for acquiring wealth. He writes:

Controlling your time is the highest dividend money pays.

People want to become wealthier to make them happier. Happiness is a complicated subject because everyone’s different. But if there’s a common denominator in happiness—a universal fuel of joy—it’s that people want to control their lives.

The ability to do what you want, when you want, with who you want, for as long as you want, is priceless. It is the highest dividend money pays.

Money’s greatest intrinsic value—and this can’t be overstated—is its ability to give you control over your time. To obtain, bit by bit, a level of independence and autonomy that comes from unspent assets that give you greater control over what you can do and when you can do it.

Exercise is like being rich. You think, “I did the work and I now deserve to treat myself to a big meal.” Wealth is turning down that treat meal and actually burning net calories. It’s hard, and requires self-control. But it creates a gap between what you could do and what you choose to do that accrues to you over time.

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