It is a common belief in modern society that money can’t buy happiness. Yet that does not seem to stop people from trying! People are consistently over-extending themselves, pushing their cash flow commitments to the limits as household debt levels continue to inch their way back up toward 2008 levels.
Despite this, it may surprise many of you that I actually disagree with that statement. However, I do believe that many people just emphasize the wrong kind of “happiness” in their pursuit.
The comparative nature of our society, heavily reinforced by the social media craze we are living through, focuses our attention on a form of happiness that comes and goes like the high from a drug. We buy something (whether that is a thing or an experience) and receive a short emotional boost at the outset, followed by a return back to our original state and a burning desire for more consumption in order to get us back to that high feeling we experienced.
A few weeks ago, I was in Madison, Wisconsin for the semi-annual advisory board meeting for the Personal Finance program at my alma mater, the University of Wisconsin. These meetings bring me a great sense of pride and joy, as I have a front row seat to see the inner workings and development of the program, the curriculum for the students, and I get to have a very small hand in helping shape its future.
This year, we were treated to a brief presentation by Dr. Christine Whelan, who was offering us an overview of the new class she has been teaching at Wisconsin, titled “Consuming Happiness.”
Dr. Whelan earned her Ph.D. from Oxford University, where she focused her research on trying to understand why and how the “self-help” industry has transformed into an $11 billion business. Her research concludes that succeeding at “self-help” ultimately means attaining fulfillment through self-control, whether that is controlling your personal behavior, social life, workplace, or romantic situation. We CAN consume our way to happiness, but that consumption must be more focused on lifting ourselves and those around us toward being one’s best self.
Dr. Whelen explains that if we are to successfully pursue “happiness,” we must distinguish between "hedonic" happiness (the experience of pleasure or positive things) and "eudaimonic" happiness (self-actualization or engaging in meaningful activity). Hedonic happiness is not inherently bad, per se, but it must frequently be forgone, deferred, or receive a flat out “no” in order to pursue the sustained, lasting happiness that eudaimonic happiness offers.
In the context of happiness, the concept of fulfillment often gets lost in the shuffle. We compare our “happiness” to what we observe around us. We value ourselves by the number of “likes” and “retweets” we get for the things we post on social media, and we go to great pains to control the way others perceive us, rather than controlling ourselves. At the end of the day, we can either spend our money on experiences or stuff. Even when we save it, it will eventually be spent on experiences or stuff. Research overwhelmingly demonstrates that values-based experiences matter most.
It is also important to recognize that this is not a zero-sum game where you solely choose one or the other. However, if it is happiness and fulfillment that you seek in life, your choices matter. Some things that really matter are not going to produce pleasurable short-term feelings. However, they will lead to a greater state of fulfillment and lasting happiness in the long-run.
This is where the concept of the 6 Capitals comes into play. We have introduced that concept to many of you in varying degrees as conversations have evolved over the years. nce the financial foundation is firmly in place, your long-term trajectory is sound and you have developed a resiliency plan for the wide variety of assumptions that will inevitably change, the allocation of future resources ought to be centered on maximizing your life worth, rather than your net worth.
That said, capturing moments like the one on the right and watching these little munchkins grow and develop makes it all worthwhile…and it truly is the most fulfilling thing I have ever done!