How we think and feel about money has been on my mind a bit.
I’ve been thinking about how those who don’t have money are constantly stressed and worried about getting more of it — and those who do have money are constantly stressed and worried about keeping and growing it. It seems that no matter your level of wealth, being stressed about money is a universal thing.
It makes sense that those without much money would be preoccupied with getting more of it. But if the wealthy continue to be preoccupied with getting more of it and are still stressed, then… what’s the point? Who are the winners?
In Nick Murray’s book, Simple Wealth, Inevitable Wealth he has a quote that I really like:
“No matter how much money you have, if you’re still worried, you aren’t wealthy.”
A great example of this comes from a Bogleheads forum post titled I’m 70 years old and I can’t spend my savings. The author says, “I can’t spend money without feelings of anxiety. It’s really painful.”
He lists a bunch of big purchases he’s made and tried to feel good about:
- “Daughter needed new car – $16,000, done earlier this year.
- Furniture – last week my wife said I want to replace all our furniture with some really nice stuff. Will probably cost $15-$20,000 minimum. I said great, let’s do it.
- Red Sox tickets – out-of-town relatives are visiting. I said let’s take them to a Red Sox game. $500 – done.”
But he just can’t bring himself to feel good about any of it. He states, “None of this makes me happy. Every expenditure is accompanied by moderate anxiety.”
A key point here is that there’s no reason for his anxiety. He has a $6 million portfolio, a $1 million house, and gets $60,000 a year from Social Security. At the end of the post he gets to the root of the problem:
“I think I know where this comes from – my father (a big influence on me) was born in 1920. His father died in 1932 (think about it ….). My father was extremely frugal, and he never invested a single penny in the stock market. Growing up in the 1920/1930s he distrusted it 100% for the rest of his life.”
If objectively well-off people like this guy still stress about money, you can be sure that those who’ve yet to reach that level of financial independence do so as well.
A survey of over 40,000 employees in various fields of work found that people spend an average of one hour and twenty minutes a day thinking or worrying about money. And 10% of respondents claimed to spend two to three hours a day stressing about money. On top of that, 53% reported feeling overwhelmed about their current financial condition.
Almost every piece of financial content out there focuses on how to make as much money as possible. However, more money doesn’t seem to help lower anxiety, so perhaps what we should dedicate more time and attention to is our relationship with, and how we feel about, the money we do have.
Frequently obsessing over and fixating on your financial situation is not a sign of a healthy relationship with money. The whole purpose of putting together a financial plan and accumulating wealth is to be able to stop worrying about money and be free to enjoy your life.
I love this tweet I saw a few years ago:
If you flip Nick Murray’s quote around, I think it offers one of the most accurate definitions of wealth I’ve found. Being wealthy means not worrying about money.
Isn’t that the whole point of wealth? Isn’t it supposed to make our lives less stressful?
Someone with modest savings who is content and grateful for what they have is far wealthier than someone with millions of dollars who’s unable to enjoy their money or to stop worrying about it.
How we feel about money is far more important than how much of it we have.
Thanks for reading!
Jake Elm, CFP® is a financial advisor at Dentist Advisors. Jake a graduate of Utah Valley University’s nationally ranked Personal Financial Planning program. As a financial advisor at Dentist Advisors, he provides dentists with fiduciary guidance related to investments, debt, savings, taxes, and insurance. Learn more about Jake.</em