The March 2018 issue of Money
magazine cited an interesting study of millionaires and their perception of
wealth and happiness. The study,
conducted by researchers from the Harvard
Business School ,
queried 4000 millionaires on how they’d rate their happiness on a ten-point
scale.
I suppose it’s not surprising that the majority of the subjects
did not give themselves the highest score, a “10”. Few people of any social status can say they
are “perfectly happy”. What does shock
me is that 27% of them said they would need to grow their wealth by 1000% to
reach that blissful state. Another 25%
said they required a five-fold increase in their net worth to get there.
I don’t know if the survey allowed the respondents to list something
other than money that could make them happy; the published results only spoke
to how much more money it would take.
That stands in contrast to a 2010 study of more
“average” people (as measured by amount of wealth) that showed that an increase
in income did tend to increase happiness levels, but only to a point. Beyond an annual income of $75,000, the
increase in level of happiness was minimal or non-existent the more money the
subjects made. Apparently not the
millionaires, though. “The more the
happier” might be their motto.
My former boss, a hospital CEO, told me on several occasions
that it was one of the saddest things he saw among physicians with whom he
worked. More than a few were reluctant
to retire, even when they were seemingly financially secure. It was not always a love of the job,
either. Too often he found that the
doctors thought they needed “just a little more (money)” before they could retire. Then the saddest twist of all, they did
retire and died within a year or two—or even died before retiring.
It would be easy to blame greed for this attitude; and in
the end we are personally responsible for our actions and attitudes. But our economy is driven by consumerism and
the ability of sellers to convince potential buyers that they must have
whatever is being sold.
And the financial industry is not blameless. How many financial planners are telling their
clients they have to have at least $1 million to retire with confidence? They are selling “safety”. They instill a fear of the worst possible
outcome and convince their clients they must be 100% safe against that
potential outcome by putting away more and more money—preferably into an
account that the planner manages, for a percentage fee.
I was impressed by the decision of one “average” person, as
reported in last month’s edition of Money,
who thanks to the recent good performance of the stock market reached the
dollar goal she had been shooting for in planning her retirement…and then took
it out of the stock market entirely and put it in a safe, money market-type
account. Her attitude was, “I reached my
goal, this is what I need to live on in retirement, and now I don’t have to
worry about losing any of it if the stock market drops.”
That’s the antithesis of the attitude of the majority of
those surveyed millionaires. She’s happy
with what she has and is living more worry-free than they are, I would wager. I don’t necessarily endorse her course of
action; but it’s her choice, she ran the numbers, and it’s what she has decided
will work for her. Bravo.
This is not to diminish the importance of ambition and
having high aspirations. We should aim
high in life. But if accumulating great
wealth is the main purpose, know that achieving that will likely not yield
happiness.
There’s one more finding from that survey that I’ll speak to
in my next post.
Until next time,
Roger
“Some people don’t
have friends or family. But they are
never satisfied with what they own, and they never stop working to get
more. They should ask themselves, ‘Why
am I working to have more? Who will get
what I leave behind?’ What a senseless
and miserable life!” Ecclesiastes 4:8 CEV