Money Doesn’t Buy Happiness

Money Doesn’t Buy Happiness

As the saying goes money doesn’t buy happiness.  I can say as someone working in financial services for 20-plus years that this is extremely accurate.  I’ve seen people all over the wealth spectrum and the amount of wealth does not correlate to happiness. But…

That said there is a big BUT (get your head out of the gutters).  The but is this, certainly those that have accumulated money, or assets, have one less thing to worry about.  Additionally, money can purchase experiences or luxuries that can enrich one’s life or take the stress away.  Furthermore, money can buy you more time, in the form of outsourcing things like housekeeping or landscaping and repurposing that time to things that do bring you happiness.  So, in theory, money doesn’t “buy” happiness, but can afford you a more ideal lifestyle that can lead to more happiness.

The importance of financial planning

This all leads to my observation and point of this article.  At the core financial planning allows one to lay out their goals and dreams.  We get to the core of what does make you happy and how to balance life to afford it.  The art and science of financial planning is one that is an ongoing process of continually checking one’s progress towards achieving their life goals, and how to work smarter, not harder.

This can be done with high-level and advanced strategies, tax planning, budget discussions, education, or investment decisions.  All these things can lead to more money, within your income band.  Net result?  Ideally, by being more planned and strategized this can all sum up to a happier existence. 

Examples:

1. A couple comes in not understanding how to afford their retirement lifestyle.  They are scared that once their incomes stop they have no idea how to continue to receive funds in a methodical and planned manner to keep up their current lifestyle.  After we run through a detailed financial plan they leave not only with a clear understanding of how to make it happen, and what is feasibly able to happen, but a partner in us that can MAKE it happen.
2. The client comes in with their investments in cash due to the great recession in 08, despite it being over a decade later.  We discuss and educate their investment allocation, along with our proposed solution.  As end result, their investments are working for them (smarter not harder) and they are afforded the ability to go enjoy more life with their newfound money.
3. Clients come in and own a small business.  They have no tax optimization in place or retirement investments.  We get them linked up with our tax team and investment team to optimize both their retirement plan and high-level tax savings strategies.  Now not only do they bring home more money and pay less in taxes, but those dollars are starting to accumulate rather quickly.  End result they have more money and are going to be able to do the things that make them happy.

Now, I don’t want people to get discouraged in the least if they haven’t quite gotten to where they would like to be.  It happens at a different pace for different people.  Those that aren’t living within their means, and accumulating debts generally are more stressed due to it.  I can tell you that anecdotally and based on studies I’ve seen working with a financial planner leads to happier individuals and better financial circumstances.  Guess it tells you something that these two items are so closely aligned with one another. 

In summary, I like to look at it this way, money does not buy you happiness.  However, the lack of it, or the stress of it can lead to less happiness.  If it is the case that financial planning can help cure all of this then go tell your friends and we are certainly here to help.

Thanks and as always stay wealthy, healthy, and happy.