We’ve all heard the adage “Money can’t buy happiness.” But, earlier in life, when your assets are limited, that doesn’t seem to be true. Money does buy security, freedom to travel, and luxuries for your families to make their lives easier, which seems like it would translate to happiness for many.
As we get older and start to reap the rewards of our hard work, we often expect to see an increase in life satisfaction. But, does that happen? We want to explore the idea of financial freedom and how it contributes to life satisfaction, giving you some tips to make your affluence more enjoyable and worthwhile.
Does an Increase in Wealth Provide More Freedom or More Fear? Or Both?
As individuals begin to increase their wealth — especially if it happens rapidly — two things happen. First, they start to realize that options open up, both tangible and intangible. All of a sudden, the trip overseas you’ve been dreaming about becomes feasible. Opportunities to start new businesses or to afford luxuries for your family become possible. Second, you begin to wonder, “How long will this last?”
While this is not a certainty, it is undoubtedly a fear many of us feel as we enter a more affluent stage in life. We may worry that money will change us or that we will have to chase it continually to maintain a particular lifestyle. With value-based investing that doesn’t have to be true.
It Depends on Your “Why”
Those who work hard and invest wisely to better their families and community seldom fall into the downsides of the wealth paradox. However, if you’re not sure you’re using your money for the right reasons, ask yourself:
- Are you constantly chasing money for money’s sake? While this can be rewarding for some highly competitive and driven individuals, studies show that quality of life does not increase after reaching a certain income threshold.
- Are you strategically planning to provide for your family and the community for the long term? Those who have a purpose in their life – a family, a meaningful career, and a community in which they feel involved — are likely to use their wealth to maximize these more essential elements to living.
How You Steward Your Money Matters
Finding responsibility and confidence in how you’re spending contributes to long-term life satisfaction. If you have a plan for your wealth and aren’t just sitting around waiting for the good or bad to happen, you are much more likely to find happiness in wealth. Start thinking about retirement, college tuition, side businesses, and ways to volunteer. These investments are what make your wealth worth the effort.
Additionally, consider what causes are meaningful to you. Outside of your church, are there causes that spark your passion? How can you invest in the impact those causes are making?
Wealth may create fear, and it can also create the opportunity to serve and enjoy a meaningful life. Talk with your financial advisor today.